India yesterday banned export of onions with immediate effect, a move probably to make a crisis in the markets of Bangladesh.
The Indian Directorate General of Foreign Trade yesterday uploaded a notice on its website stating, "Exports of all selection of onions are prohibited with immediate effect."
India has been the main source of onion imports for Bangladesh.
India banned onion exports last year following a scarcity in its local market.
It caused a sharp rise in prices in Bangladesh, forcing the government to fly in onions even from Europe.
Bangladeshi domestic production can meet demand for 7-8 months and 7-8 lakh tonnes of onions are would have to be imported every year.
Bangladesh Trade and Tariff Commission (BTTC) prepared market report on the production and stock of onions.
The report says the country includes a stock of 5.25 lakh tonnes of locally grown onions and it will require six lakh tonnes more to meet the domestic needs before next main harvesting season, typically March-April.
It predicted that the neighbouring nation might impose export restrictions that could improve the price of onions in the neighborhood market, the BTTC reasoned.
The report said Indian onions accounts for 95 percent of what was annually imported, and prices were going up as floods damaged crops.
The report also suggested that the Trading Corporation of Bangladesh (TCB) choose imports to improve stocks, sell onions in the domestic market, address problems linked to transportation, and strengthen monitoring.
This past year, India imposed an export ban on September 29, leading to prices of the key cooking ingredient to skyrocket to a historic most of Tk 250 per kg in Bangladesh.