India bans onion export, price spirals in Bangladesh

The Indian government on Sunday imposed a ban on export of onion against the backdrop of price hike of the item in its domestic market.

In a notification the Directorate General of Foreign Trade, under the commerce ministry of India, the Indian government prohibited export of all varieties of onions until further notice, reported Press Trust of India.

It said that India imposed ban on onion export to increase availability of the commodity in the domestic market and contain rising prices.

It said that retail onion prices had skyrocketed to Rs 60-80 per kg in Delhi and some other parts of India due as supply was disrupted as the growing states like Maharastra now remained under flood waters.

Any movement of onion prices in Indian market has an effect on Bangladesh market as the country is one of the major buyers of Indian onion.

Earlier, the Indian DGFT on September 13 imposed a minimum export price of $850 per tonne, doubling the previous price, to curb its shipments and help bring down rising domestic prices.

As a result, prices of onions increased by Tk 15-20 a kg to Tk 55-65 a kg in Bangladesh on September 14.

Although the commerce ministry assured several times in last few days that the prices of onions would come down, the prices of the commodity continued to increase in the market.

Traders have already started import of onions from Myanmar, but the initiative failed to curb the prices in the local market.

The local variety of onions were selling for Tk 70-80 a kg and the onions imported from India were selling for Tk 65-70 a kg in the city markets on Sunday. 

News Courtesy: www.newagebd.net