Govt trying everything to battle high onion prices
New Delhi: Government today unveiled multi-pronged measures to check high onion prices, including removal of import duties, an indefinite ban on exports and asking state agencies to import the commodity, as retail prices continued to hover around Rs 70-80 a kg.
While wholesale market prices of the kitchen staple recorded a 40 per cent drop in the major producing region of Nashik in Maharashtra, the central government expressed confidence that it will reflect in retail prices in a couple of days.
The sudden spurt in onion prices, which had played a politically sensitive role during elections over a decade ago, forced the government to abolish the five per cent customs duty and four per cent countervailing duty to boost imports.
Simultaneously, it also asked state trading agencies MMTC, STC and PEC to source onion from other countries to help augment domestic availability.
The Commerce Ministry, which had earlier suspended export of onion till January 15, today converted it into an indefinite ban.
"I met CMDs of three public sector companies -- MMTC, STC and PEC -- and asked them to look around for import contracts (for onion)," Commerce Secretary Rahul Khullar told reporters.
Onion prices soared from Rs 10-11 a kg in June to Rs 70-85 a kg following heavy rains in the producing regions of Maharashtra and Karnataka.
"Prices in the wholesale market have already started showing declining trend. We are hopeful that in a couple of days it will be reflected in retail price also," Consumer Affairs Secretary Rajiv Aggarwal told reporters.
However, it would take more than a couple of weeks for things to return to normal as fresh arrivals are expected from Haryana, Punjab, Uttar Pradesh, Bihar and Gujarat starting from December end.
Aggarwal said the Maharashtra government informed the Centre that damage due to rains is to the extent of 40 per cent of normal production, while Karnataka, Gujarat, Rajasthan and Madhya Pradesh reported 15-20 per cent damage from rotting and reduced size.
India produced 12 million tonnes of onion last year, of which Karnataka and Maharashtra account for 40 per cent.
Cabinet Secretary K M Chandrasekhar, who is monitoring the situation on an hourly basis, asked the Commerce Secretary to speed up onion imports and also states to take stringent action against hoarders.
Aggarwal claimed that the average all-India retail price of onion was only Rs 49.97 per kg, while the highest was recorded in Tiruchirapalli at Rs 75 a kg, Thiruvananthapuram Rs 73 a kg. In Delhi, onion was selling for Rs 64 a kg.
The Consumer Affairs Ministry has also requested states to intervene in the market by directly procuring from wholesale market and selling in the retail as was being done in Delhi.
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