India’s onion export tax policy leaves Kalimati vegetable godowns depleted

Published On: August 23, 2023 04:30 PM NPT By: Republica | @RepublicaNepal

KATHMANDU, Aug 23: After India imposed a 40 percent duty on onion exports, businessmen have stopped importing onions.

After the import of onions was halted, there was a shortage of onions in the main vegetable markets including the one in Kathmandu’s Kalimati. On August 19, India decided to impose a 40 percent customs duty on onion exports.

Since then, on Saturday and Sunday, there was only sporadic trading of onions, but since Monday, import and sales of onions have stopped, according to the Kalimati Fruits and Vegetables Market Development Board.

Binay Shrestha, information officer for the market development board, said that all the shops in the vegetable market have run out of onions. “There are 80 shops where potatoes and onions are traded in the market,” Shrestha said, “All these shops have run out of onions. Since there are no onions in the market, there is no situation for fixing the price of onions.”

Traders who deal in potatoes and onions based in Kalimati and Kathmandu have claimed that after India imposed an export tax on onions, the traders there did not sell onions.

Prakash Gajurel, Nepal Agricultural Produce Potato, Onion Import Export and Wholesalers Association said that the exporters did not export onions in Nepali market because they were in a dilemma due to the sudden policy.

“The businessmen have not been able to import onions. The onion stock is depleted,” General Secretary Gajurel said, “Now there is no situation where onions will be available in the market without ease of import.”

The wholesale price of onions in Kalimati market on Sunday was Rs 61 per kg. On Sunday afternoon, the price of onions in the market started to increase arbitrarily. Soon after, the supply of onion in the market was stopped after the Department of Commerce and Supply Management monitored it.

The Department of Commerce has speculated that even though the onions may not have arrived after India imposed the tax, the onions that had already been imported may have been hidden. Gajendra Thakur, director general of the department, said that strict action will be taken if black market is found.