FTP - Export Policy - Onions - Steep cut in MEP
GOVERNMENT has amended para 2 of Notification No.03(RE-2012)/2009-14 dated 29.06.2012 read with Notification No.59 (RE-2013)/2009-14 dated 19.12.2013 with immediate effect.
Export of onion for the item description at Serial Number 51 & 52 of Schedule 2 of ITC (HS) Classification of Export & Import Items will now be subject to a Minimum Export Price (MEP) of USD 150 per MT.
It was USD 350 per MT last week 800 USD ten days back and 1150 USD per MT in September.
Now, this is a steep cut. It is reported that this reduction is aimed at encouraging exports amidst a crash in wholesale prices leading to protest by farmers in producing states.
A meeting was held on December 25, 2013 between the Minister of Agriculture and the Minister for Commerce and Industry to discuss the issues related with sharp decline in the wholesale prices of onions in the producing mandies of Maharashtra and need for a review of MEP. This meeting was attended by senior officials from the Departments of Agriculture & Cooperation, Consumer Affairs and Commerce.
After reviewing the situation of arrivals in the producing and major consuming mandies, retail and wholesale modal rates as well as foreign trade scenario, inter-alia, the following decisions were taken:
i) To further reduce the MEP from USD 350 PMT to USD 150 PMT.
ii) Secretaries of Departments of Commerce, Consumer Affairs and Agriculture/ Inter Ministerial Committee (IMC) on onions will regularly and closely monitor the arrivals, wholesale modal prices and retail prices of onions in the country. The government will make appropriate interventions in future as and when required to ensure price stability for consumers and adequate domestic availability of onions along with price protection for farmers with a view to balance the interests of both farmers and domestic consumers.
The reduction in MEP by DGFT (the day after the meeting) is in pursuance of the above decision.
At least onion doesn't seem to be one of the challenges before Arvind Kejriwal.
DGFT Notification No. 61 (RE-2013)/2009-2014, Dated: December 26, 2013