The Indian government has announced that the 20% export duty on onions will be lifted from April 1, 2025, bringing an end to restrictions that have been in place for over a year. This decision is expected to significantly impact onion prices in both wholesale and retail markets, providing much-needed relief to farmers.
Impact on Onion Prices
With the removal of export duty, Indian onion farmers will once again have access to international markets, potentially increasing demand and farm-gate prices. Wholesale prices in mandis could see an upward trend, benefiting farmers who have struggled with low returns due to restrictions.
At the same time, retail onion prices may rise slightly as exports resume, but government officials have assured that domestic supply will remain stable to avoid major price surges.
The export bans and duties imposed in 2023 were aimed at controlling domestic inflation but ended up causing financial distress for onion farmers, especially in Maharashtra, Karnataka, and Madhya Pradesh India’s largest onion-producing states. Many farmers had to sell their produce at lower prices due to limited market options.
With this policy shift, onion growers can expect better profits and market stability, while consumers may see minor price fluctuations. The government’s move signals a shift towards balancing farmer interests with price control measures in the domestic market.