Government to sell onions at 20% discount than market rate

The Centre today decided to compensate agriculture cooperatives, NAFED and NCCF, by up to 30% of the losses they suffer by selling onion at Rs35/kg in Delhi.

The two agencies are selling onion at subsidised price at stores run by them and Kendriya Bhandar.

While the staple vegetable is being sold at Rs35/kg, a new price will be fixed after January 15.

This price will be 20% less than the market price, NAFED managing director Sanjeev Chopra said.

NAFED has been given instruction to this effect after a high level meeting chaired by cabinet secretary KM Chandrasekhar, sources said.

In the absence of subsidy, while the scheme had been announced by the cooperative, there was a scarcity of stock at the retail outlets. This problem would be addressed now.

Chopra said that 50-100 tonnes of onions per day would be sold through Nafed stores and mobile vans besides Kendriya Bhandar.

Nafed will also supply onions at subsidised rates to Mother Dairy, which will further sell them through its 400 outlets adding other expenses, he said.

As for supplies, Chopra said Nafed would procure from Maharashtra and Gujarat. This would be supplemented by imports, which are likely to materialise in the near future.

The subsidy outgo is estimated at Rs5 crore per month for Nafed, he said, adding that the scheme may be extended to other cities as well.

Though there was a correction of Rs5-7/kg, onions continued to sell at Rs50-60/kg in the metros.