KATHMANDU, March 26: India has unexpectedly extended its indefinite ban on onion exports, contrary to traders' expectations. The Indian government, in light of the upcoming Lok Sabha elections, issued a notice prolonging the export ban until further notice.

Initially, the ban on onion exports was anticipated to be lifted by March 31, as per the previous notification. However, the recent extension has repercussions for countries like Nepal, Bangladesh, Malaysia, and Saudi Arabia, which rely on the Indian market for onion imports. If the export ban persists, it could lead to a drop in onion prices within India while affecting import-dependent markets elsewhere.

According to the Indian media, in some markets of India's Maharashtra, where onions are produced a lot, the price per quintal decreased from Rs 4,500 to Rs 1,200 last December. According to market analysts, the production of onions in India is good this time, and since new onions are coming to the market at this time, there was no need to continue the ban.

Since last December, India has halted onion exports, leaving Nepal with insufficient domestic production to meet demand. In response, traders have increased imports from China while resorting to smuggling onions across the Indian border due to formal import restrictions.

At a time when prices are expected to decline, there is an abundance of onions in the market. However, despite the surplus, prices remain high. At the Kalimati vegetable market in Kathmandu on Tuesday, the wholesale price of Indian onions stood at a minimum of Rs 70 per kg.

 
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