India’s Onion Export Crisis: Farmers Pay the Price of Policy Uncertainty

Onions, often called the “kitchen staple of India”, have once again become the symbol of a deeper agricultural crisis. In 2025, India’s onion export revenue fell by nearly ₹1,100 crore, marking one of the worst years for onion growers in decades. Behind these numbers lies a painful reality for farmers, especially in Maharashtra’s Nashik belt — the heartland of onion production.

A Sharp Fall in Export Earnings

According to exporters, India earned around ₹4,500 crore from onion exports in 2024. This year, the figure dropped to ₹3,100 crore, resulting in a massive loss. One of the biggest reasons for this decline has been the exit of Bangladesh, India’s largest onion importer, which alone accounted for nearly ₹1,700 crore in export revenue.

Bangladesh’s decision to stop importing Indian onions was driven by its push to promote domestic onion production. While this move strengthened Bangladesh’s self-reliance, it dealt a heavy blow to Indian farmers and exporters.

Government Curbs and Market Credibility

To control rising onion prices for domestic consumers, the Government of India imposed export duties and later a complete export ban between 2023 and 2025. While the intention was price stability, the outcome proved counterproductive for exports.

Frequent policy changes damaged India’s credibility in the international market. Importing countries turned to alternatives like Pakistan, where onions were available at cheaper and more stable prices. Once lost, markets are difficult to regain — a harsh lesson Indian exporters are now facing.

Rising Competition from Neighbouring Countries

During the period when India restricted exports, Pakistan exported around 2.2 lakh tonnes of onions between December 2024 and March 2025. Looking ahead, Pakistan plans to increase onion production to 27.8 million tonnes in the 2025–26 crop year. This expansion poses a serious threat to India’s share in South Asian, Middle Eastern, and Southeast Asian markets.

Climate Shock Adds to Farmer Distress

As if policy and market challenges were not enough, onion farmers in Nashik were hit by unseasonal rains. The monsoon arrived early in May and continued until mid-November, damaging stored and standing crops. Losses continued for nearly seven months, severely impacting yield and quality.

Prices Below Cost of Production

The ground reality for farmers is grim. In November last year, onions fetched up to ₹4,900 per quintal. This year, prices have crashed to ₹1,400–1,500 per quintal, far below the cost of production. Farmers are struggling to recover even basic input costs such as seeds, fertilizers, labour, and storage.

As one farmer from Lasalgaon put it, “We are not asking for profit. At least help us recover our costs.”

Role of NAFED and NCCF: Relief or Illusion?

The government procured onions through NAFED and NCCF to ensure affordable prices for urban consumers. However, farmer organisations argue that this move benefits traders more than producers. Onions are sold at discounted prices in cities, while farmers continue to receive meagre returns, raising questions about who truly benefits from such interventions.

What Exporters and Farmers Are Demanding

The Onion Exporters Association has urged the government to:

• Increase the 4% export incentive on vegetables

• Implement 1.9% RoDTEP benefits on onion exports

• Ensure a stable and predictable export policy

Farmers and exporters agree that sudden bans must be replaced with long-term, balanced solutions.

The Way Forward: Balance Is the Key

India’s onion crisis highlights a recurring problem in agricultural policymaking — the struggle to balance consumer affordability with farmer sustainability. While controlling inflation is important, it should not come at the cost of pushing farmers into distress.

A stable export policy, better storage infrastructure, climate-resilient farming practices, and fair price mechanisms are urgently needed. Without these reforms, India risks losing not just export markets, but also the confidence of its own farmers.

Conclusion

The onion is more than just a vegetable — it is the livelihood of millions of Indian farmers. The current crisis serves as a wake-up call for policymakers to rethink short-term fixes and adopt long-term strategies. Saving India’s onion economy means saving its farmers first.

A nation that feeds the world must ensure its farmers do not go hungry.