Traders rue underpriced onion exports to the UAE
Centre has permitted 24,400tonne shipments to the country amid ban on exports; exporters allege that selling price is being set too low, triggering windfall profits for selected UAE importers
mid an extended ban on onion exports, farmers and traders are miffed that some shipments allowed by the government to markets such as the UAE have been sold at a pittance, even as global prices have soared, yielding windfall profits for selected importers.
An Indian farmer is being paid just ₹12 to ₹15 for a kg of onions procured for export, which are then being sold in UAE stores for more than ₹120 a kg, exporters alleged.
Fearing a domestic shortage of the politically sensitive crop, the government had imposed a ban on its export in December, extending it indefinitely “till
Afurther orders” last month. However, it had kept the window open for exports to countries in response to requests received through diplomatic channels.
On March 1, the Centre permitted the export of 14,400 tonnes of onions to the UAE, with a quarterly cap of 3,600 tonnes. While over 3,000 tonnes of such exports were cleared last month, the Commerce Ministry last week okayed an additional 10,000 tonnes for the UAE, “over and above” the quarterly quota.
Rate mismatch
Usually, global onion prices hover in the $300400 a tonne range. In recent months, however, rates have soared in major markets such as the UAE to as high as $1500 a tonne, exacerbated by the export bans imposed by India, Pakistan, and Egypt.
India’s recent shipments to the country, however, have been sent at around $500 to $550 a tonne, exporters have learnt.
“UAE importers have already got windfall gains of over ₹300 crore through such shipments, and if this situation continues, another ₹1,000 crore is likely with the additional 10,000tonne quota opened up now, apart from the gains likely on the additional 3,600 tonnes of export quota available for that country till June,” a leading exporter of horticulture produce told The Hindu.