Date:03/08/2008 URL: http://www.thehindubusinessline.com/2008/08/03/stories/2008080351220300.htm

Back Quality norms for onion exports tightened

G. Srinivasan

New Delhi, Aug. 2 The Directorate-General of Foreign Trade (DGFT) has amended its November 2007 notification on onion exports to streamline procedures, tighten quality norms and eliminate abuse of permits.

The move is designed to track transaction of exports and promote quality onion exports in the overseas markets.

Export of onions are permitted by 13 designated canalising agencies, mostly State Trading Enterprises, besides the National Agricultural Cooperative Marketing Federation of India Ltd (Nafed), which sets the minimum export price (MEP) on onions every month.

The MEP for August ranges from $235 to $495 for shipments in refrigerated containers. The MEP for southern varieties of onion ranges from $360 per tonne of Podisu onion to $520 a tonne for Bangalore Rose or KP onion.

Indian onions are exported mostly to Bangladesh, Pakistan, Nepal, Sri Lanka, Malaysia, Singapore Africa, Japan and some European countries.

The export of onions has been subject to MEP for several years and no shipments are allowed below the MEP of the concerned month.

The crop prospects, its assessment and forecasts, market intelligence, likely trends within the county and abroad as well as expenses entailed in logistics are factored in while fixing the MEP, officials said.

The latest notification by the DGFT states that export of onions, allowed without quantitative ceiling, should be subject to conditions of quality laid down by Nafed.

It further said the canalizing agencies, allowed to issue no-objection certificates to registered onion exporters, should not levy any other charges except at a maximum rate of one per cent of the invoice value of exports.

A weekly report of permits issued to registered exporters has to be furnished to Nafed, which would act as a nodal agency to keep the Centre apprised of the outflow of onions. The notification also enjoins the designated agencies to forward reports of the shipments of onions to the Department of Consumer Affairs.

Official figures on onion exports show that such exports have been increasing in recent years — from 8.29 lakh tonnes in 2003-04 to 11.61 lakh tonnes in 2006-07. In 2007-08, India exported 11.01 lakh tonnes of onions, which fetched Rs 1,285.82 crore.

However, the markets for Indian onion are limited to SAARC region and to a few countries in the Far-East and West Asia.

Trade sources here told Business Line that onion exports to Europe, the United States and Africa are almost negligible, though many countries in these regions have large requirements with a lot of expatriate Indians.