It’s enough to make you cry
on Jana Gana Mana (India), 11/Jan/2011 02:59, 34 days ago
The spectre of rising onion prices is haunting Indian politics again. As prices trebled over a period of three weeks, touching Rs.90 a kg (about £1.40) in some parts of the country (compared to the usual Rs25-30), the liliaceous plant, whose bulb is the mainstay of many Indian staple recipes, became a topic of debate and discussion not only for ordinary consumers, but for economists and policymakers as well. India is the world's second largest producer of onions after China. But in the face of galloping prices, the central government enforced a ban on exports and allowed imports from Pakistan.Onions have enriched traders, brought incensed women and men on to the streets, and brought down governments. The vegetable is consumed in considerable quantity, and any rise in price tends to be politically sensitive. In north India especially, curries and dishes are incomplete without it. The defeat of the Bharatiya Janata Party in the 1998 Delhi Assembly election was attributed, to a large extent, to its government's failure to curb the rise in the price of onion. Already tagged as pro-trade, it was slow to react at that time. Twelve years later, the Congress-led United Progressive Alliance seems more aware of the political risks in letting the situation spin out of control so the Government has been doing its best to take action to stabilise the price at a lower level. One of the key actions has been to import millions of tonnes of onions from Pakistan (as we saw first-hand during our trip to the border - see photo!) and sell them in the Government food shops at a low price so that the millions of Indians who rely on this staple food can afford to eat. However, this policy doesn’t appear to be so successful in the markets where the price stubbornly remains at circa Rs60.The underlying issue is really one of food production. Even with a successful monsoon and bountiful harvest, total food production grew by just over 1% last year. All very well but not so good set against a population growth of 1.5%% per annum!Meanwhile, approval has recently been given to reclassify several thousands of acres of farmland on Delhi’s city boundary to urban growth in order to cope with the population influx. Hmmmm.....sounds familiar?Stop press:"Retail prices of onion jumped up by Rs 5-10 per kg to up to Rs 65 in metros due to lower supplies from Pakistan.As 300 India-bound trucks carrying 3,000 tonnes of onion had reached the Wagah border near Amritsar, Pakistan's commerce ministry imposed a ban on movement through land route, giving a shock to India.Onion prices increased to Rs 60-65 a kg in major metros such as Delhi, Chennai and Mumbai. "Retailers have jacked up prices on reports of ban by Pakistan," General Secretary of Tomato and Onion Merchants' Association in Delhi's Azadpur Mandi said.New Delhi dubbed the Pakistan's decision as "shocking", with commerce and industry minister Anand Sharma stating the issue has been taken up with the concerned authorities in Islamabad.Pak's undiplomatic onion"It is shocking and unfortunate that Pakistan has banned onion exports to India via land route...The matter has been discussed with the High Commissioner in Islamabad, who has already met the concerned officials there," Sharma said.He said Pakistan has been asked to reconsider its decision or at least release the trucks carrying contracted quantity of the commodity.As Sharma reviewed the situation with heads of government importing agencies STC and PEC, top secretaries of the ministries of agriculture, commerce and finance went into a huddle with cabinet secretary K M Chandrasekhar to find alternative supplies."