Biz Updates: Central government took a big decision on onion export and wheat stock, Import of yellow peas allowed without minimum price conditions

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New Delhi| The Central Government has taken two major decisions related to onion export and wheat stock. The minimum export condition applicable for onion export has been removed with immediate effect. This information was given by the government by issuing a notification. In May 2024, the Modi government had lifted the ban on onion exports, but fixed the minimum export price (MEP) at $550 per metric ton. Now onion prices have stabilized in major domestic markets. At the same time, in the poll-bound state of Maharashtra, where onion crop is mainly grown, farmers were demanding removal of the MEP limit. It is believed that this is why the government has taken this decision.

India’s onion exports are projected to fall by more than 50 per cent in June as a minimum export price of $550 per tonne and export duty of 40 per cent made Indian onions more expensive than competitors, exporters said in a media interaction in August. In the current financial year 2024-25, a total of 2.60 lakh tones of onion has been exported till 31 July 2024. India exported 17.17 lakh tonnes of onion in FY 2023-24. The central government has further tightened the limit on wheat stocks held by traders and mill owners. The government has taken this step with the aim of increasing the availability of grains and controlling prices. According to the government’s new order, traders can now keep only 2,000 metric tons of wheat against 3,000 metric tons in their stock.

The government has also tightened the stock-holding limit for wheat processors. Processors can now keep 60 percent of monthly installed capacity multiplied by the remaining months of FY25, its order said. Previously this was 70 per cent of installed capacity. Processor units include biscuit and bread making companies. Wheat prices in domestic markets have risen to around Rs 2,700 per quintal in the last few weeks due to strong demand ahead of the festivals.

The minimum export price (MEP) of $950 per tonne on Basmati rice has been removed, the government said on Friday. Commerce and Industry Minister Piyush Goyal said that this step will boost exports and increase the income of farmers.

“It has been decided to remove the current Minimum Export Price (MEP) of US$ 950 MT for the issue of Registration-cum-Allocation Certificate (RCAC) for export of Basmati rice”, according to a communication from the Department of Commerce. APEDA (Agricultural and Processed Food Products Export Development Authority) was requested to take immediate action to implement the decision. However, it also said that APEDA will closely monitor the export contract for any non-realistic price for Basmati exports.

The government also informed that import of yellow peas has been allowed without minimum import price and restrictions at ports. However, for all consignments of yellow peas, imports will have to be registered under the online import monitoring system with immediate effect. This will apply in cases where a bill of lading relating to full information on goods for carriage has been issued on or before December 31, 2024.

The Government has increased 20 customs duties on crude and refined sunflower oil to 20 per cent and 32.5 per cent respectively. According to the Finance Ministry notification issued on Friday, the basic customs duty on crude palm, soybean and sunflower seed oil has been increased from zero to 20 percent.

The basic customs duty on refined palm, soybean and sunflower oil has been increased from 12.5 per cent to 32.5 per cent. The effective duty on these crude oils and refined oils will increase from 5.5 per cent to 27.5 per cent and from 13.75 per cent to 35.75 per cent respectively. The new rates will be effective from Saturday.

The Reserve Bank of India has imposed a fine of Rs 31.8 lakh on BNP Paribas for certain deficiencies in statutory and regulatory compliance. The central bank gave this information on Friday. The central bank has also fined Hewlett Packard Financial Services (India), SMFG India Credit Company and Muthoot Vehicle and Asset Finance for not following some of its norms.

In a statement, the Reserve Bank said that a penalty has been imposed on bank BNP Paribas for not following certain instructions issued regarding ‘interest rate on advances’. The statutory inspection for the bank’s supervisory assessment was carried out with reference to its financial situation as of March 31, 2023. After that a show cause notice was issued to the bank.

The Reserve Bank said that after considering the bank’s reply to the notice and the stand taken during the hearing, it found that the allegations against the bank were true for which it was appropriate to impose monetary penalty. ‘‘bank failed to adopt uniform external standard rate within the same loan category in respect of certain loans, the central bank said.’’

In addition, the Reserve Bank has imposed a fine of Rs 10.40 lakh on Hewlett Packard Financial Services (India) Pvt Ltd, Rs 7.9 lakh on Muthoot Vehicle and Asset Finance Ltd and Rs 23.1 lakh on SMFG India Credit Company Ltd (formerly Fullerton India Credit Company Ltd). However, the Reserve Bank said the penalty is based on deficiencies in statutory and regulatory compliance and is not intended to decide on the validity of any transactions or agreements entered into by entities with their customers.

Passengers are troubled by the delay in domestic aviation companies. In August, 1.8 million passengers were affected due to aircraft delays. In lieu of this, the aviation companies paid compensation of Rs 2.44 crore.

According to the Directorate General of Civil Aviation, 38,599 flights were cancelled in August. This cost the companies 1.14 crore for compensation and convenience to passengers. 728 passengers were barred from travel. 77.96 lakhs were spent on this. In the country’s aviation industry, only 71 per cent of aircraft are operating on time. The timely performance of Akasa’s aircraft has been 71.2 per cent, Vistara 68.6 per cent. Only 66 per cent of IndiGo and Air India’s performance and only 31 per cent of SpiceJet’s aircraft have run at the right time. From January to August, a total of 10.55 crore people traveled by air.