DGFT Amends Export Policy for Onions to ‘Prohibited’ Status

Case Name:

Amendment in Export Policy of Onions under HS Code 0703 10 19 - Notification No. 49/2023-DGFT

Key Takeaways:

1. The export policy for onions under HS Code 0703 10 19 has been amended from ‘Free’ to ‘Prohibited, till 31.03.2024’.
2. An exception is made for consignments subject to a Minimum Export Price (MEP) of US $800 F.O.B. per Metric Ton (MT) until December 31, 2023.
3. The changes come into effect from December 8, 2023, with specific exemptions allowing the export of onions under certain conditions.
4. The transitional arrangements specified in Para 1.05 of the Foreign Trade Policy, 2023, do not apply to this notification.
5. The notification acknowledges the possibility of onion exports based on permissions granted to other countries upon their governments’ requests.

Synopsis:

The export policy of onions under HS Code 0703 10 19 has been amended from ‘Free’ to ‘Prohibited, till 31.03.2024’ by the Directorate General of Foreign Trade (DGFT) of the Ministry of Commerce & Industry, Government of India, through Notification No. 49/2023-DGFT dated 7th December, 2023. This amendment signifies a crucial change in the export policy of onions and has significant implications for trade dynamics.

The detailed analysis of the amendment and its implications:

Legal Authority

The amendment is enacted under the powers conferred by Section 3 and Section 5 of the Foreign Trade (Development & Regulation) Act, 1992, along with relevant provisions of the Foreign Trade Policy, 2023.

Export Policy Modification

The notification amends the export policy for onions under HS Code 0703 10 19, shifting it from ‘Free’ to ‘Prohibited’ until March 31, 2024. This strategic measure has implications for onion exporters.

Minimum Export Price (MEP)

While the export policy is now ‘Prohibited,’ an exception is made for consignments subject to a Minimum Export Price (MEP) of US $800 F.O.B. per Metric Ton (MT) until December 31, 2023.

Effective Date and Exemptions

The changes come into effect from December 8, 2023. The notification outlines specific exemptions allowing the export of onions under certain conditions, such as consignments already in the Customs system before the notification.

Transitional Arrangements

The transitional arrangements specified in Para 1.05 of the Foreign Trade Policy, 2023, do not apply to this notification, emphasizing the immediate and impactful nature of the policy shift.

Government Permissions and International Trade

The notification acknowledges the possibility of onion exports based on permissions granted to other countries upon their governments’ requests, reflecting international trade considerations.

Conclusion

DGFT Notification 49/2023 marks a significant alteration in the onion export landscape, imposing a ‘Prohibited’ status until March 31, 2024. While exemptions exist for consignments meeting specific conditions, the overall impact on onion trade is substantial.

FAQ

Q1: What is the effective date of the amendment?

A1: The changes come into effect from December 8, 2023.

Q2: Are there any exemptions for the export of onions under the amended policy?

A2: Yes, specific exemptions are outlined in the notification, allowing the export of onions under certain conditions.

Q3: What is the impact of this amendment on onion trade?

A3: The amendment imposes a ‘Prohibited’ status until March 31, 2024, with exemptions for consignments meeting specific conditions.