New Delhi: The soaring price of onion is the biggest concern of the common people across India. The humble onion has already hit a century in the retail markets of Bhopal and Patna. It is expected to complete a century in Delhi, Chandigarh, Srinagar, Lucknow and other north Indian vegetable markets.
In North Eastern region of India, onion price per 1 kg crossed Rs 100 on last Friday.
However in the southern states, onion is still relatively cheaper than the north. Karnataka, Andhra Pradesh and Tamil Nadu are also major onion growing states in India. Even though the recent unseasonal rain has caused a lot of damage to onion, which was ready for harvesting, the retail price is still hovering around Rs 60- Rs 70 at most places in the south.
According to a newspaper report, in Bangalore the wholesale price of good quality onion sourced from Chitradurga district is hovering around Rs 50 a kg at the Agriculture Produce Marketing Committee (APMC) at Yeshwantpur, while the retail price is between Rs 60 and Rs 70 a kg. The wholesale price of medium quality onion and small-sized onion called as gulti in market parlance is about Rs 40 and Rs 20 a kg respectively.
Commission, cess, transport and porters' cost besides the retail margins push up the price by the time it reaches the consumers, traders said. On Tuesday, the price in Bangalore ranged between Rs 30 and over Rs 60 a kg, depending on quality. While the price for a good quality onion had hovered around Rs 70 a kg early September, it had come down to less than Rs 50 towards the end of September.
Huge demand from north and eastern states for Karnataka onions has also resulted in the increase of onion price in Karnataka. In neighbouring Chennai, the price is Rs 55- Rs 65. In Hyderabad, state government run Rythu Bazaaar (farmers market) claims that it is selling onions for Rs 46-48 per kilo. In Kerala, the price is hovering around Rs 60-70.
In Maharashtra, the largest onion growing state, the retail price is Rs 60-80. In the eastern markets of Kolkata and Varanasi, the onion is selling at Rs 60-80. In the northern most state of Kashmir, onion price has almost touched Rs 100 per kilo.
Fearing a backlash in the state Assembly elections and the Lok Sabha polls early next year, the Central government is resorting to kneejerk reactions. About two months ago, it hiked the minimum export price of onions claiming that the export is causing price rise in the domestic market. But, the price has not come down even after two months.
A section of the media focused only on the Lasalgaon wholesale onion market in Maharashtra giving a false impression that only Maharashtra supplies onion to the rest of India. It is true that Maharashtra is produces over 60 lakh tonnes of onion annually making it the number one state. In reality Karnataka, Andhra Pradesh and Tamil Nadu also grow onion in a large scale.
In Karnataka the total area under cultivation is 1,15,035 hectare with a production of 7,23,067 tonnes per year. The key growing districts are Bellary, Chitradurga, Bijapur, Dharwad, Raichur and Kolar. Onion is cultivated across the state. Distinct export variety Bangalore Rose Onion is grown in Bangalore and Kolar districts.
Other important onion growing states are Orissa, Uttar Pradesh, Rajasthan, Madhya Pradesh, Bihar and Gujarat.
After many years, the vegetable and fruit growers are getting a good price for their crops. Pro-farmer groups argue that the media is batting for the middle class in the cities ignoring the fact that the price hike will benefit the farmers, who normally get a raw deal.
Some sections of the media are also blaming the farmers for not selling onions expecting a much better and higher price for onions resulting in price rise. It is a stupid argument. Farmers have every right to wait for a good price and a grower keeping the produce with him is not hoarding or illegal.
The media is also accused of giving just one-sided coverage of the onion price rise. It is focusing only on the plight of buyers, not on the growers.
According to some policy analysts, following aspects are responsible for the onion price hike.
1. Market manipulation- hoarding at different levels and cartelisation.
2. Government has not taken any steps in the past two years to either encourage new players or crack down on collusion between traders and farmers in the wholesale markets in Maharashtra.
3. Onion is not just a politically sensitive commodity but also very sensitive to market sentiment- so speculation of shortage/ disruption of supplies create the field for price rise.
4. Delayed decision making: Government's decisions are often too little too late. It hiked the Minimum Export Price (MEP) of onions twice in the middle of the crisis and decided to go in for imports too late. Had these decisions been taken timely, the right signal would have gone.
5. Onion crisis is cyclic in nature- Food Minister KV Thomas had written to all state governments to procure onions during harvest and release during lean season. Not one state government responded.
6. Huge difference between wholesale and retail price.
For the first time in many years, the farmers, who grow vegetables and fruits, are getting a better price for their crops. Resorting to kneejerk reactions like banning export of a commodity whose price is going up in the domestic market will have a huge negative impact on the agriculture sector in India. The middlemen, who exploit the farmers and make money should be punished, not the growers. Middle class is the main consumer of news and the media is naturally speaking for its consumers. But, the government should be careful in handling this sensitive issue.
As Union Agriculture minister Sharad Pawar says media is worried only about the rising price of onion. It won't bother when the price crashes and farmers commit suicide.
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