Pawar against onion export ban, says spiralling prices temporary

Written by fe Bureau | New Delhi | Updated: Jul 25 2013, 21:53pm hrs
Agriculture minister Sharad Pawar said on Wednesday he was not in favour of banning onion exports, and called the current spurt in prices of the politically-sensitive commodity a temporary phenomenon.

Wholesale prices of onion in Lasalgaon, the top trading centre in largest producer Maharashtra, have jumped 73% since June while prices in Delhi have surged nearly 140% during this period, sparking fears of a potential backlash by both consumers as well as the opposition parties. This has prompted the ministries of consumer affairs and commerce to mull a ban on onion exports to boost domestic supplies, especially in view of a 5% drop in onion production to 16.65 million tonne in 2012-13.

It is a temporary situation. Heavy rains in key producing states have affected supplies. Rains have impacted crops as well as transport and logistics, Pawar said. While wholesale onion prices have risen by 140% in Delhi since June, retail prices have jumped 250%, making a dent in the consumer's wallet. Significantly, onion exports hit 5,11,616 tonne in the first quarter through June, marginally lower than 5,17,274 tonne a year before.

It is not fair to ban export of any agricultural commodity... India has established its position as a major supplier of agricultural items in the global market. If we ban exports, this image will be affected. So, we are against an export ban on onion, Pawar said at an event organised by the Confederation Of Indian Industry.

The country's farm exports rose 25.3% to R2,33,000 crore in 2012-13, thanks to unrestricted shipments of several items, including grains, guargum and onion.

Spiralling onion prices were cited as a key reason for the defeat of the BJP in Delhi assembly elections in 1998, and the kitchen bulb has been a politically sensitive item ever since for its wide consumption. India had last banned onion exports in 2011 after prices more than doubled in just one month.

Onion prices are likely to be high until October, when the new crop is expected to hit the market. Although production is expected to be normal in 2013-14, lower harvests in states such as Tamil Nadu has put pressure on supplies from Maharashtra.

Organised sectors share in milk biz needs to rise Pawar said the share of the organised sector in the countrys milk business needs to be raised to 50% by the end of the current Plan period through March 2017 to keep prices at reasonable levels. At present, the organised sector accounts for roughly 30% of milk marketing.

India, with 128 million tonne of production, now ranks first among milk-producing nations... We need to target that by the end of this Five-Year Plan period, at least 50% of milk in the country is handled by the organised sector, Pawar said, speaking at the India Dairy Summit organised by the CII.

Dairy contributes close to a third of the gross income of rural households and, in case of those without land, nearly half of their gross income, Pawar said.

The government has launched the National Dairy Plan Phase-I with a total investment of more than R2,200 crore for the current Plan period to meet a projected demand of 150 million tonne of milk. Although India is the world's largest milk producer, its per capita consumption at 290 gm per day remains marginally above the world average. Still, the country has managed to make some progress in the five years through 2011-12, said Amrita Patel, chairperson, NDDB.

If we take Indias milk production figure for 2011-12 (128 million tonne), and compare it with other major dairying countries, we see that over the previous five years, the country's milk production has increased by about 25 million tonne compared with an increase of about 6.6 million tonne in the US, 5.4 million tonne in China, 2.7 million tonne in New Zealand and 1.6 million tonne in the EU, she said.