The government, as usual, ignored the production and availability of onion and met <g data-gr-id="52">forecast</g> of a weak monsoon in May. The Mumbai-market controlled onion trade did what it had been doing for decades – export cheaply during the season and import at high cost at the season-end to maximize profit on both.
Few governments, not even the one led by the late Indira Gandhi, had the political courage and will to control, if not stop altogether, onion export and import to stabilize the trade for the benefit of the common man. High onion and potato prices had caused election downfall of ruling parties.
Therefore, the BJP-led NDA government can’t be faulted for the decision to import onions ahead of important Bihar Assembly election. The retail onion market in North India is sizzling under unprecedently high prices reaching Rs. 80 for a kilo while wholesale prices are hovering around Rs 5,000 per quintal. The prices may go up to Rs 100 per kg by next month. Rainfall in Maharashtra, the biggest onion grower, has so far been below average.
Somewhat jittery, the government directed the National Agricultural Co-operative Marketing Federation (NAFED) to cancel its global <g data-gr-id="49">e-tender</g> which it failed to issue in time and, instead, asked the public sector MMTC to import 10,000 tonnes of onions as early as possible. Punjab traders are believed to have already started importing onions from Afghanistan in small quantities through the Attari-Wagah land route. Two to four trucks of onions are entering India daily by this route. Pakistan, China and Iran are among the key onion import sources of India.
Paradoxically, India’s onion exports had gone up 25 <g data-gr-id="47">per cent</g> in May and June, after a four-month slump, because of less competition in destinations such as Sri Lanka and West Asia. The onion trade never witnessed a better export-import opportunity. Smart traders with hoarded onions are having a ball.
Rising onion exports earlier this year helped <g data-gr-id="43">spurt</g> <g data-gr-id="44">modal</g> prices in the benchmark Lasalgaon market at Rs 1,300 a quintal in early June as against Rs 1,000 at the beginning of May. As a result, arrivals rose by almost 30 <g data-gr-id="45">per cent</g> to 13,000 tonnes as export prices surged by $25-50 to $375 within a month. According to reports, data compiled by the National Horticulture Research and Development Foundation (NHRDF) showed, India’s onion exports at 265,066 tonnes between April – May last year.
Exports went up by 20-25 <g data-gr-id="46">per cent</g> this year. India’s annual onion export reached its peak at 1.87 million tonnes in 2009-10. Income wise 2012-13 and 2013-14 proved to be best for traders earning Rs 2,295 crore and Rs 2,877 crore respectively.
Now, India is forced to import onion after persistently exporting the commodity till through the first half of the year.
Interestingly, two years ago in August 2013, the Manmohan Singh government, then reeling under
high onion prices ahead of 2014 Lok Sabha election, ordered up to 3,00,000 tonnes of the commodity to minimize the impact of the opposition criticism across the country. India had exported 1.36 million <g data-gr-id="42">tones</g> of onion, that year.
Political parties have won and lost elections in India over the cost of Onion, a key ingredient used to make spicy dishes from curries to biriyani. Few senior politicians have forgotten how Indira Gandhi swept back power in 1980 by turning the price of onions into a populist rallying agenda assailing the incumbent government for its failure to control prices.