Traders in Nepal have resumed import of onions from India to meet rising domestic demand ahead of the festive season, as supplies were halted following India’s decision to impose a 40 per cent export tax on the vegetable.

Last week, India, the world’s biggest onion exporter, imposed a 40 per cent tariff on exports of the vegetable till December 31 in a bid to restrict overseas sales.

The move reportedly comes amid fears of a price hike ahead of the festive season, when demand for most items spikes.

The new tariffs have severely hit Nepal as many traders at the Kalimati fruit and vegetable market – the Himalayan country’s largest wholesale market for agricultural products – have reported a sudden shortage of onions. Nepal imports 99 percent of its onion requirement from India.

Traders in Nepal imported 265 tonnes of onions from India in the last 48 hours, helping to resume smooth supplies of the vegetable ahead of the festive season.

Kalimati Fruit and Vegetable Market Development Board spokesperson Binay Shrestha said, 120 tonnes of onions were imported from India on Wednesday and 145 tonnes arrived till noon on Thursday.

The wholesale price of onion has been fixed at Rs.10. 75 per kg after tax adjustment, he said.

Traders had stopped import of onions on Monday and Tuesday after India imposed export duty on the vegetable.

The onion which was sold for Rs.100 a kg. It has now reached Rs 70 per kg in the retail market. 100 after levy of export tax.

However, with supplies smoothed out, there is no shortage of onions in the market, though traders have started hoarding the vegetable after India announced tariffs.

The Consumer Protection Division under the Ministry of Industry, Commerce and Supplies intensified market surveillance activities last week following complaints from some consumer groups about onion shortage and price hike.

Ghanshyam Subedi, director of the division, said market surveillance was carried out at more than 30 locations in the last four days.

He said that those who charge unreasonably high prices have been fined as per consumer protection laws.

(Only the headline and image of this report may have been reworked by Business Standard staff; the rest of the content was auto-generated from a syndicated feed.)

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