The government today said there is no proposal to ban export of onion and its prices in the domestic market are showing a declining trend.
"There is no proposal to ban export of onion," Minister of State for Agriculture Tariq Anwar said in a written reply to the Rajaya Sabha.
The untimely rains in different onion growing areas, which has affected the crop and its supply chain, has contributed to sharp increase in its prices, he said.
A sharp increase in onion prices was seen during three months till January, he added.
However, there has been a declining trend in onion prices since the beginning of the current month.
The wholesale prices have dropped to Rs 16/kg today in Nasik, Maharashtra, from Rs 25/kg in the beginning of the month, as per the data maintained by government research body NHRDF.
Similarly in the national capital, wholesale prices have declined from Rs 25/kg to Rs 17.50/kg in the review period.
Prices of vegetables such as onion are governed by market forces of demand and supply, cost of transportation, cost of storage and rising demand among others, Anwar said.
Due to tight supply, onion exports have shown a declining trend since November, 2012. The shipments fell by over 40 per cent to 83,044 tonnes in January, as against 1,47,255 tonnes in the year-ago period, according to the NHRDF data.
According to the Nasik-based National Horticultural Research and Development Foundation (NHRDF), the area under onion crop is down by 10 per cent from 10.87 lakh hectares this year. But the overall production is expected to be the same at last year's level of 174 lakh tonnes.
Maharashtra, Karnataka and Gujarat are the top three onion growing states which have suffered drought.