Govt keeps import window open to avoid further onion price rise

Written by Press Trust of India | Updated: Jan 31 2011, 09:29am hrs
To prevent a repeat of last month situation when exorbitant onion prices stung the common man to tears, the government on Sunday said it is open to importing more of this vegetable to ensure better supply to masses.

I have kept my import window open. I do not know what will happen tomorrow, I do not know what will happen day after, commerce secretary Rahul Khullar said. He was replying to a query if the government would consider lifting ban on onion export and stop importing this kitchen staple through public sector firms - STC and PEC as price of the vegetable has starting coming down.

The onion prices have come down to about Rs 35-40 a kg in the national capital. Its prices rocketed to as high as Rs 70-85 per in December 20.

Cooperatives like NCCF, Kendriya Bhandar and Mother Dairy are selling onion at Rs 24 per kg in the national capital.

The downward price trend in onion is attributed to softening of the vegetable rate in the open market.

The Centre had last month abolished import duties on onion and banned its exports for indefinite period to improve its supply in the domestic market.

Acute scarcity of onions after unseasonal rains hit the Kharif crop in Maharashtra and Karnataka, the states that together account for almost 50% of the country's total production, leading to an escalation in its wholesale and retail prices.

The spike in this kitchen staple's price led the state-run trading firms to import about 1,100 tonne of onion from Pakistan.

Khullar claimed that the onion imported from Pakistan was sold at Rs 18-20 per kg in the Azadpur mandi.

Approximately 60% of the country's onion crop is grown during the rabi season, while the rest is harvested in the kharif and late kharif seasons.

The country's onion output is likely to dip by over 12% to 10.5 million tonne in the 2010-11 crop year due to untimely and erratic rains last year. India produced 12 million tonnes of onions in the 2009-10 crop year. Onions are grown in three seasonskharif (summer), late kharif and rabi (winter).

CCI to visit Nashik wholesale mkt soon

The officials of competition watchdog CCI will next week visit Nashik's wholesale onion market to probe the role of traders in the skyrocketing prices of the essential kitchen item, which became a major political issue.

The investigative team of the Competition Commission of India (CCI) is expected to visit the Lasalgaon mandi, Asia's biggest onion market, some time next week, CCI sources said.

We have learnt that onion traders had met before the price hike and then the announcement came. It it clearly the influence of big traders, else no demand-supply study explains the sudden rise in the price of onion to this extent, a CCI official said.