A prohibition on the exportation of onions, which India is internationally renowned for, was implemented in response to an increase in domestic demand.
Nevertheless, India has recently granted permission for an additional 10,000 tonnes of onions to be exported to the United Arab Emirates. This decision is expected to mitigate the exorbitant prices of onions in the UAE market.
This decision comes strategically just ahead of Eid Al Fitr, a time when demand for staple goods such as onions, alongside other vegetables and spices, traditionally surges in the UAE. The recent escalation in onion prices in the UAE has been staggering, surpassing Dh7 per kilogramme, a notable surge from the usual prices of Dh2 to Dh3 per kilogramme in hypermarkets.
Occasionally, prices even plummet to Dh1 per kilogramme during weekend promotions aimed at enticing customers and enhancing foot traffic.
The announcement regarding the export of 10,000 tonnes of onions to the UAE has been made through the National Cooperative Exports Ltd (NCEL), an entity overseen by the Director General of Foreign Trade under India's Ministry of Commerce and Trade. This quantity supplements the 14,400 tonnes that were dispatched to the UAE the previous month. Previously, New Delhi had granted approval for the export of 79,150 tonnes of onions to selected nations.
Notably, India's decision to halt onion exports was prompted by a surge in domestic demand. Kamal Vachani, the group director and partner at Al Maya Group, expressed optimism about the development, highlighting its potential to stabilize onion prices in the UAE. He emphasized the preference of UAE consumers for Indian onions due to their affordability, quality, and taste.
This increase in onion exports coincides with the signing of the Comprehensive Economic Partnership Agreement (Cepa) between India and the UAE, aimed at bolstering trade ties and facilitating the exchange of essential commodities. Overall, the decision to augment onion exports from India to the UAE reflects a strategic effort to address market dynamics and uphold trade relations between the two nations.
