A fine balance

Markets in agriculture must be allowed to function

The Union government last week took decisions related to the import and export of agricultural items. It removed the minimum export price (MEP) on Basmati rice. The government had last year imposed an MEP of $1,200 per tonne on Basmati rice, and that was later lowered to $950 per tonne. The government also reduced the minimum export duty on onions from 40 per cent to 20 per cent. On the other hand, it increased the import duty on edible oils from zero to 20 per cent. After adding other components, the effective duty would be 27.5 per cent. The basic Customs duty on refined oil was also increased to 32.5 per cent. The government expects this decision to increase demand for domestic sunflower, groundnut, and mustard refined oil.