INDIA – India has prolonged its ban on onion exports indefinitely, sending ripples through global markets and exacerbating the plight of countries reliant on Indian onion imports.

This decision, initially imposed in December, was anticipated to be lifted as domestic prices plummeted and fresh crops flooded the market.

However, a recent government directive has extended the ban until further notice, confounding traders, and stakeholders alike.

“The extension is surprising and completely unnecessary, considering the falling prices with rising supplies from the new season crop,” expressed an executive at a Mumbai-based export firm, opting to remain anonymous.

Indeed, wholesale onion prices in Maharashtra, India’s largest onion-producing state, have nosedived from 4,500 rupees to 1,200 rupees per 100 kg since December, marking a significant downturn in market dynamics.

With Prime Minister Narendra Modi vying for a third consecutive term in the upcoming elections commencing April 19, this move adds a layer of complexity to an already heated political landscape.

The ban’s continuation comes at a time when rival exporters are capitalizing on the vacuum created by India’s absence in the market, leading to inflated prices and limited options for buyers across various countries.

“India’s move is allowing rival exporters to quote much higher prices since buyers have no choice,” remarked another executive from an export company in Mumbai.

India’s significance as a major onion exporter in Asia cannot be overstated, with its shorter shipment times offering a competitive edge over counterparts like China and Egypt.

The ban’s impact reverberates across regions such as Bangladesh, Malaysia, Nepal, and the United Arab Emirates, where reliance on Indian onion imports is substantial.

These nations have grappled with soaring prices since the ban’s imposition, further compounded by supply chain disruptions and logistical challenges.

In response to escalating prices and supply shortages, India recently reopened its onion export channels to the UAE, signaling a temporary respite for consumers amidst a tumultuous market environment.

However, the ban’s extension underscores the government’s prioritization of domestic concerns over international trade obligations, eliciting mixed reactions from stakeholders worldwide.

“The resumption of exports to the UAE offers a glimmer of hope for consumers, but uncertainties loom large as India navigates through intricate geopolitical dynamics,” remarked an industry expert.

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