India plans to purchase 1,650 tonnes of onions from private lenders at Rs 29 per kg for export to Bangladesh, recent reports said on Monday.

National Cooperative Export Ltd (NCEL), the government’s export agency, has announced plans for a move that marks the first official export of onions from India in over three months, following the government’s ban on exports from December 8 to March 31.

The exact selling price of onions to Bangladesh by NCEL remains undisclosed, the report said.

However the report predicted substantial profits for the export agency, with onions currently priced at Rs 80-90 per kg in the Bangladeshi market.

Notably, in the first week of March, the Centre permitted the export of 64,400 tonnes of onions to countries that had made formal requests through diplomatic channels.

Of this quota, 50,000 tonnes were allocated to Bangladesh, with the remaining 14,400 tonnes going to the UAE. The restrictions on onions were implemented by India to address surging domestic prices, which had led to concerns about affordability and availability.

The ban resulted in a spike in international prices due to reduced global supply, particularly during the peak demand period associated with Ramadan in traditional markets like Bangladesh, West Asia, and Southeast Asia.

There have also been reports suggesting a recent spike in the smuggling activity of onions. Reports suggested that smugglers acquire sugar from locations like Shillong, Guwahati, and other locations in Assam at Rs 40-50 per kg and sell it in Bangladesh for Rs 135-140 per kg.

According to the data shared by the BSF, in January, the security force intercepted and seized 2,776 kg of onions valued at Rs 10,19,120.

The following month, this figure increased dramatically by over 288 per cent, with 10,780 kg of onions worth Rs 35,09,434 being seized which would decay till disposed of by the system.

It is worth highlighting that India typically dominates the global onion market between the months of January to March.

Between April 1, 2023, and August 4, 2023, a total of 975,000 tonnes of onions were exported from India, with Bangladesh, Malaysia, and the UAE emerging as the top importing countries in terms of value.