With retail prices of onions hovering around Rs 80-100 in most major markets across India, the government is considering importing onions from countries like China, Egypt and Russia.
Elaborating on the plan, Ram Vilas Paswan, Union minister for food and public distribution, stated that the government agency MMTC has been directed to float a tender for import of onions to meet any shortfall in availability.
Since 2016, India has been importing fresh onions from countries such as Afghanistan, the UAE, Singapore and Egypt. In 2018-19, the imports from Afghanistan amounted to 833.09 MT, from UAE - 6.02 MT and Singapore - 2.51 MT.
The current shortfall, if any, may result in similar imports but from countries that are found suitable for the purpose. According to government sources, the tenders for the same, depending on the need, may be floated at the end of the monsoon season as according to a Ministry of Agriculture Report on Onions for the Month of August, production of onions during the year 2018-19 (Third Advance Estimate), is expected to be 0.96% higher as compared to the previous year, which was 23,485,000 tonne.
Kharif arrivals
However, the said report adds that as per information received from major Kharif growing states i.e., Karnataka, Maharashtra, Rajasthan, Madhya Pradesh and Gujarat, up to August 30, 2019, area sown was 1.81 lakh ha against corresponding period of last year 1.88 lakh ha. The information for final sown area is awaited from the states while the stored onions are being released in the market for sale.
Further, harvesting of early Kharif is continuing in Kurnool area of Andhra Pradesh and is being released in different markets of southern part of the country wherein the quality of onion is medium to good.
The report added that the arrivals in August 2019 were lower than July 2019 and to corresponding month of last year, but higher than average of five years (2013-2017). The per quintal price for onion, in wholesale market, was Rs 2312.3 for August which was Rs 1,821 in August last year.
Exports
Meanwhile, the country has been undertaking exports of onions as well for the last couple of years. The figures for the month of August for export of onions are not known as yet but in July, 160,645 tonne of onions were exported.
“The reported export below Minimum Export Price to Bangladesh and Sri Lanka will be immediately stopped and strict action will be initiated against those who are found to be violating this decision of the government,” said the minister.
Measures to prevent crisis
A government official said, “The trends in state-wise monthly prices (wholesale and retail) and arrivals with regard to important crops like Potato, Onion and Tomato show that the wholesale prices and arrivals are negatively related – however, in few cases this law was not followed apparently, may be because of arrivals from other states. The difference between retail and wholesale prices reveals the margin of various intermediaries involved in the sale and purchase of Potato, Onion and Tomato. This would also throw light on the incidence of fiscal measures e.g., taxes, freight rates and transportation.”
Meanwhile, Paswan stated that states have been requested to utilise a stock of 35,000 tonne available with the Central government for direct retailing to ease the pressure on prices. Communication in this regard was sent to the state governments asking them to indicate their requirement from the Central buffer. Till date, five states namely, Haryana, Andhra Pradesh, Delhi, Tripura and Odisha have demanded onions from this stock.
NAFED (National Agricultural Cooperative Marketing Federation of India), which holds the Central buffer on behalf of Union government, has been directed to distribute onions in Delhi through stores of Safal, Mother Dairy, NCCF and its own outlets at a fixed rate of not more than Rs 24 per kilo. The Central government also offered the Delhi government, onions from its Buffer stocks for direct retailing through its channels at similar rates. This would improve the total number of distribution centres across Delhi to about 700 outlets.
The Kharif crop of onions from Karnataka has already started arriving in the market and this will ease the pressure on supply from Maharashtra as well as prices in adjoining regions.
The minister informed that there is sufficient stock of onions in Maharashtra to meet the current demand. However, supplies are seemingly being restrained to increase prices. Government is taking all measures to improve these supplies and from Central buffer to mitigate any such shortfall in availability and will also consider imposing stock limit if prices do not moderate on account of speculative behaviour of traders.
NAFED has also been directed to be prepared for meeting any contingencies during the ensuing festive season and move sufficient stock in advance to places of consumption and distribution to ensure that supply remains unhindered.
