Performance of Onion Exports from India

Pramod Kumar, Alka Singh, P.S. Badal and R.P. Singh

Foreign Trade Review, 2006, vol. 40, issue 4, 49-63

Abstract: Onion is one of the important vegetable crops grown in India. In terms of area, India ranks first in the world with over 479 thousand hectares spread over entire country accounting for around 18 per cent of the world area planted to onion. Globally, the country occupies the second position after China in onion production with a share of 11 per cent. In the post-liberalization era, a number of export promotion measures have been taken to boost agri-exports. Onion being one of the major export items, it is very pertinent to assess the performance of onion export in post liberalized regime in order to take corrective measures and devise future strategies to achieve greater levels of export. The paper attempts to study the changes in composition and direction of onion exports and estimation of export demand for onion. Onion was exported from the country mainly in four forms [at 8 digit HS (ITC) classification] i.e., onions fresh or chilled, onions preserved/prepared by vinegar acetic acid, onions dehydrated/dried and onions provisionally prepared. Substantial change in composition of onion and its products has taken place over the years, with the share of onions fresh in total onion exports falling to 83 per cent in TE 2002 from a high of 99 per cent in 1980. In the decade of 1990s, onion fresh recorded a marginal growth in volume terms whereas onions dehydrated/dried and onions provisionally prepared recorded a very high growth of 23 and 7 per cent respectively. Therefore, the focus in future should be to produce and export processed products of onion, i.e. onions dehydrated/dried and onions provisionally prepared by vinegar acetic acid for accelerated foreign exchange earnings. The insignificant growth of unit value realization for onions fresh or chilled, onions preserved and onions dehydrated exports is a cause of concern. In Singapore, Sri Lanka, Malaysia, and Mauritius Indian onion fresh or chilled was getting higher unit value price and, therefore, the focus could be to expand the market base in these countries. The Markov chain analysis was done to estimate the market share for the period 2009. It was estimated that Bangladesh would account for highest share of onion fresh exports followed by Malaysia, United Arab Emirates (UAE), Singapore, etc. With the enforcement of Free Trade Agreement (FTA) with Sri Lanka, the declining trend in exports to Sri Lanka is expected to be reversed. There is a need to expand the export market of onions and also to look for avenues where higher price realization is possible. There is also a need to have long term and stable policy towards export of onion. The supply of onion for exports could be increased through increased production and by way of reduction in post harvest losses. An adequate policy support is needed to take the available technology to the farmers.

Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:sae:fortra:v:40:y:2006:i:4:p:49-63

DOI: 10.1177/0015732515060403

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