With crucial state elections around the corner, the central government scrapped the minimum export price (MEP) on onions and basmati rice, according to a notification from the ministry of commerce and industry. It has also reduced the stock holding limit for wheat for traders, wholesalers and retailers to increase supply in the market.The government had imposed an MEP of $ 500 per tonnes on onions in May which discouraged exports of the bulb. The move comes ahead of assembly elections in Maharashtra, a key onion producing state.As prices of onions had started inching up, the government, which has created a buffer of 4.7 lakh tonnes from the rabi crop of onions for any price interventions in case the prices rise, has started the retail sale of onion at Rs 35 per kg from the stocks available with the National Cooperative Consumer’s Federation of India (NCCF) and National Agricultural Cooperative Marketing Federation of India (NAFED) last week.”The Minimum Export Price (MEP) condition on Export of onions is removed with immediate effect and until further orders,” the directorate general of foreign trade (DGFT) said in a notification.RiceThe department of commerce has directed APEDA to remove the MEP of $ 950 per tonne for issuing registration-cum-allocation certificate for export of basmati rice which was imposed last year.Exporters had earlier said higher MEP could adversely impact the domestic procurement of basmati rice paddy for the next season and hit farmers’ income as global prices of some varieties of aromatic rice have already fallen below MEP. Haryana, a key producer of basmati, is headed for assembly elections soon.In October last year, the government reduced MEP for basmati rice shipments to $950 per tonne from $1,200 per tonne, fixed on August 25 to restrict ‘illegal shipment of white non-basmati rice’ whose shipment was banned in July last year.
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