The Hindu Business Line : Tough questions on tear-jerker

The flare-up in onion prices across the country during the festival time and just prior to that last month is still is people’s minds, as indicated by a pointed question by senior BJP leader Prof Vijay Kumar Malhotra in the Lok Sabha on Tuesday. He sought clarification from the Government on its on-off export ban on this tear-jerker.

It all began when the BJP member claiming that India had a bumper onion crop of 92 lakh tonnes, and exported 13.8 lakh tonnes, with the domestic consumer paying Rs 30 per kg and the grower getting a measly Rs 4-5 per kg.

Responding to this concern, the Minister of State for Commerce, Mr Jairam Ramesh, set the record straight by saying that onion production during 2006-07 was only 65-66 lakh tonnes and that the exports of 13 lakh tonnes constituted 20 per cent.

Moderating effect

He said that when onion prices shot up in October 2007, the Government immediately shifted the export of onion from the 13 canalising agencies to the restricted list, entailing licence or permit for export. He said this shift in approach to export has resulted in preventing prices from shooting up further and had a moderating effect, so much so that on November 14, it reverted to export through the canalising agency and did away with licensing.

Reeling off statistics, Mr Ramesh said that today wholesale price of onion in the Azad Mandi (local market) is ruling at Rs 7.50-8.50 per kg, while at the retail level its price is Rs 12-16 per kg.

However, another BJP member and a former Minister Mr Santosh Gangwar, recounted the plight of onion growers in Karnataka who had to sell their produce at Rs 2 per kilo, while exporters/middlemen reap fabulous margins in onion exports. Both Prof Malhotra and Mr Gangwar maintained that exports should benefit farmers and not middle-men or traders.

This prompted Mr Ramesh to state that exporting onion through designated agencies, such as NAFED, is to ensure that such institutions are basically co-operatives designed to take the growers interests on board as they are the biggest stakeholders.

Think of the farmer

He further observed that “if there is one commodity constantly under scrutiny, it is onion, as the then Delhi government in 1999 had to bear the brunt of the onion price flare-up!”

He also noted that the Government had prescribed the minimum export price (MEP) of $425 per tonne, or Rs 17 per kg, below which no onion could be exported. Mr Ramesh also clarified that the Ministry of Agriculture estimates of 92 lakh tonnes was nowhere near the estimates of NAFED, and that differences in production estimates are being reconciled.

When both the BJP members persisted in knowing what steps the Government is contemplating to address the deplorably low returns the actual growers of onion get particularly at a time exporters corner the major benefits, both Mr Ramesh and his senior colleague Mr Kamal Nath merely said that it is “a larger issue”, providing no clue as to how this pertinent issue affecting the farmers is to be addressed in keeping with the avowed UPA goal of serving the aam aadmi.

G. SRINIVASAN

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