India permitting onion exports to Bahrain, Mauritius upsetting major international markets, say traders

The Indian government’s recent decision to permit onion exports to Bahrain and Mauritius has stirred controversy within the exporting industry. Despite these countries’ limited historical imports of Indian onions, the government’s move has left larger importers feeling neglected and frustrated, according to the industry players. 

• Also read: Onion exporters seek “fair and just” export system

Critics within the industry argue that the government’s favouritism towards smaller countries such as Bahrain and Mauritius could harm India’s trade relationships with larger importers. They suggest that exports should be opened in a measured way for all countries or not at all, to avoid appearing biased.

The decision to export to Bahrain, in particular, has raised eyebrows. Despite Bahrain’s minimal onion requirements, some selected exporters have capitalised on its strategic location, with access to Saudi Arabia and the UAE by land. Some exporters are reportedly planning to import to Bahrain and then transport onions by road to neighboring countries to maximize profits. This would help exporters earn significant profits.

Critics question the rationale behind supporting such countries, which import from other sources like the Netherlands and Egypt. They argue that these countries have not supported India in times of surplus, and therefore, India should reconsider its export strategy to ensure fairness and reciprocity in trade relationships.

Rubbing the wrong way

According to industry reports, some countries, including Indonesia, have refused to open their quotas for Indian onions, citing India’s export ban. This could potentially halt exports to Indonesia until March 2025.

“Countries like Malaysia and UAE, which have an average import share of 10 per cent, have not utilized their quotas in the current year,” said one of the industry players. “It would be more ethical to support these larger importers.”

The industry has also expressed disappointment with some countries which refused to request onions from India through official channels.

Wait for notification

Despite a ban on onion exports, India allowed the sale of 54,760 tonnes to Bangladesh, Mauritius, Bahrain, and Bhutan last month.

• Also read: Central team visits Nashik to address concerns of onion farmers

However, onion exporters and farmers in Maharashtra are still waiting for the export notification. The Onion Traders Association in Nashik has urged the government not to delay the notification, warning that any further delay will adversely affect farmers and exporters who have already suffered due to the export ban.

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