That the price of onion, a staple ingredient for the aam aadmi, has soared to the stratosphere across the country is now widely felt. Whether the price rise has been engineered by traders or some political parties in the western belt, or because of a shortfall in domestic production is immaterial.
What’s important is that the humble bulb has added to the woes of the poor and the vulnerable who are grappling with the general rise in prices of all essential commodities.
Lest the political dispensation is caught on the wrong foot due to the zooming price of onions, Radhakrishna Vikhe-Patil, the agriculture minister of Maharashtra, the state which grows this root in largest volumes, had gone on record saying that the crop area in the state had shrunk from 67,000 ha last year in Nasik to 35,000 ha, even as the stock that is procured from Andhra Pradesh and Tamil Nadu has failed.
How far and fast the crisis could be mitigated could only be known after the arrival of the late rabi crop to the market sometime in the middle of next month. It is unfortunate that since August, big traders and retail chains have kept up this artificial scarcity since onion doesn’t fall under the Essential Commodities Act.
Interestingly, onion production in 2012-13 was lower by 4.89 per cent and exports were higher by 17 per cent last year.
Though the authorities said the price rise in onion is not linked to exports as the latter constitutes less than 10 per cent of total domestic production, the country exported 16.63 lakh tonnes of onion and earned Rs1,964 crore in 2012-13, while in the first quarter of the current fiscal (Apr-June) onion exports amounted to 5.11 lakh tonnes that fetched Rs776.47 crore.
Though the Commerce Ministry used to monitor the prices of essential commodities, particularly the sensitive ones which are imported to India, it has ceased doing so in the last few years.
The price movements in staple foods or agricultural commodities being exported do not figure in the scheme of things till a crisis erupts — like the onion! No wonder, an inter-ministerial group that reviewed the situation decided to raise the Minimum Export Price of onions to $900 per tonne from $600 tonne to discourage exports, though a formal call is yet to be taken! Hiking the export price of onion is not the best option as the price of the bulb would get hardened in the overseas market if India is to import it in bulk. India imported onions worth Rs31 crore in 2010-11 and the widening current account deficit does not provide any window for import of items like onion!
Even as onion prices hover around Rs70 per kg with wholesalers warning that it will soon become even more prohibitive — Rs100 per kg — hopes now hinge on the arrival of the rabi crop to ease supply constraints. In 1998, the BJP lost power in several state elections, including Delhi, because of a spurt in onion prices.
Now the BJP sees a golden opportunity in the onion crisis with its cadres opening several outlets to sell onions. All political parties should see the writing on the wall because they can ill-afford this sort of nationwide crisis!
The writer is a freelance journalist based in Delhi