The government today slashed the Minimum Export Price (MEP) of onion with immediate effect to 350 dollars a tonne from the existing 800 dollars per tonne. The move is aimed at encouraging its exports.

The Commerce and Industry Ministry in a statement said that an inter-ministerial panel, after factoring in improvement in arrivals in the latter half of November and in early December, decided to reduce the MEP of onion.

The government said, a cut in MEP will help arrest the sharp fall in prices realised by farmers besides help stabilise prices by balancing interests of farmers and consumers.