Mumbai:
Onion prices refuse to come down despite the emergency measures and crackdown on hoarders. Onion prices rocketed to as much as Rs 85 per kg in some markets forcing the government to remove customs duty on the import of onions which was earlier pegged at 5 per cent.
(Read: The onion effect - Food inflation in double digits)But it's not just onions, prices of other vegetables like tomatoes and peas continue to rise too. In Mumbai for example, tomato prices have more than doubled in less than a month. They have gone from being Rs 28 per kg to close to Rs 60. In Patna, garlic prices have gone up sharply.
The prices, however, might normalise in two to three days - that's the assurance given by Bijender Singh, the chief of NAFED or National Agricultural Cooperative Marketing Federation of India Limited. NAFED is the country's top nodal agency for marketing agricultural products. Speaking to NDTV, he said hoarding and not scarcity is what has sparked off the crisis and hence action was being taken against hoarders.Singh was speaking after his meeting with Delhi Chief Minister Sheila Dikshit.
When Minister of State for Agriculture KV Thomas was asked when will the prices come down, he said, "I am not a magician, I cannot say whether it will come down but we are taking all the steps that the prices will come down at the earliest."
Meanwhile, the Delhi Chief Minister has said onion prices should come down soon, they would look at prices of other things. She said, "The issue of tomatoes has come up today, we discussed onions yesterday, after which their prices have come down. Arrivals have also increased."
The government has already banned the export of onions, a move which saw wholesale prices of onions dip even though retail prices still remain high.
Hours after abolishing customs duty, the government on Wednesday asked state trading agencies -- STC, MMTC and PEC -- to immediately go for onion imports to boost domestic supply in the wake of prices spiralling to Rs 70-80 a kg.
"I have asked STC, MMTC and PEC to explore the option of quick delivery of onion," Commerce Secretary Rahul Khullar told reporters in after his meeting with Cabinet Secretary K M Chandrasekhar.
Khullar said apart from putting a complete ban on onion exports, the government has removed customs duty on the commodity.
"The DGFT has imposed a ban on onion exports until further orders. That means till we change that decision no onion can be exported. Anybody is free to import onions at zero duty," he said.
The Commerce Secretary said the state trading firms have been asked to "look around" for import contracts for quick delivery because "I need onion now" and not after six months.
The Cabinet Secretary, who is personally monitoring the situation, earlier in the day asked the commerce ministry to "speed up" onion imports to augment domestic availability.
The government's concerted action follows a steep rise in onion prices, which soared from Rs. 10-11 in June to Rs. 70-85 per kg in retail markets across the country.
The state-owned firms have to search for availability.
Khullar said that onion prices have shot up because of damage to the crop in the producing states (like Maharashtra) by unseasonal rains.
He said prices can be reined in only by the "entire package" of measures, including de-hoarding operations and no single step is adequate.
He conceded that the ban on exports and duty-free imports can partially "fill the gap" because almost 90 per cent of the demand is met by the domestic production.
In the normal weather conditions, the country annually produces 12-13 million tonnes of onion. Exports are only one-tenth of the production. While the ban on export can have a limited impact on the supply, "these things have salutary impact on the (price) sentiment".
When asked whether India is not sending signals of desperate supply situation by telling the companies to quickly search for onion, he said "you are free to make your judgment".
As for export ban, Khullar said that it is complete and "no onion can leave the port". It applies to all the traders, including those who had been issued clearances by the canalising agencies like NAFED.
Meanwhile, in a bid to provide succour to common man from heightened onion prices NAFED and NCCF have started selling at Rs. 40 per kg through their 25 stores in the national capital, but the stocks were sold out in no time. (With PTI Inputs)