Centre withdraws 20% duty on Onion Export effective from April 1st, 2025

In a significant decision, the Government of India has withdrawn the 20% duty on onion exports, effective from April 1, 2025. The Department of Revenue issued a notification to this effect following communication from the Department of Consumer Affairs.

The move comes after nearly five months of export restrictions aimed at ensuring domestic availability. The government had previously imposed export duty, set a minimum export price (MEP), and even enforced an export prohibition from December 8, 2023, to May 3, 2024. The now-removed 20% duty had been in place since September 13, 2024.

The central government has taken this step after continuous demand from the farmers of Maharashtra. Due to export duty on onion, the farmers were not getting the right price and were facing losses.Recently, Maharashtra farmer leader and former MP Raju Shetti had also written a letter to the central government to remove the export duty on onion.

Onion Export Trends

Despite the export restriction, the total onion export during FY 2023-24 was 17.17 LMT and FY 2024-25 (till 18^th March) was 11.65 LMT. Monthly onion export quantity had picked up from 0.72 LMT in September 2024 to 1.85 LMT in January 2025, according to a government press release. 

Balancing Act 

The withdrawal of export duty reflects the government’s efforts to ensure remunerative prices to farmers while maintaining the affordability of onion to consumers. With the anticipated arrival of rabi onion in substantial quantities, both wholesale and retail onion prices have softened. Even though the current mandi prices are above the level during the corresponding period of previous years, a decline of 39% is observed in the all-India weighted average modal prices. Similarly, all-India average retail prices recorded a decline of 10% over the past one month.

Onion arrival in benchmark markets Lasalgoan and Pimpalgaon have increased from this month which drove prices downward. The modal prices in Lasalgaon and Pimpalgoan on 21^st March 2025 were Rs.1330/qtl and Rs.1325/qtl, respectively.

Higher Rabi Production 

According to estimates by the Department of Agriculture & Farmers Welfare, rabi onion production for the current season is projected at 227 LMT—an 18% increase from last year’s 192 LMT. Since rabi onions account for 70-75% of India’s total onion production, it plays a crucial role in price stability until the arrival of the kharif crop in October-November. The improved production and price scenario offer a much-needed respite after the country faced challenges due to lower domestic production and high international prices since August 2023.