Between ascertaining the reasons for onion prices shooting through the roof and short-term responses to the crisis,the big picture is always lost. Even as Nafed began retailing onions at half the market price in Delhi and the prime minister asked for a day-to-day monitoring,inclement weather,export permits and hoarding have all been blamed for retail prices rising to Rs 70-80 in metros but not with equal emphasis and not from the same quarters. While heavy unseasonal rains in several states as well as the export permits issued particularly in November despite advance weather warnings may have contributed to supply disruptions and escalating prices,whats overlooked every time a crisis of this sort hits is that supply,over years,has consistently remained erratic,despite India being the worlds second-largest onion producer. As a result,prices have fluctuated through all these years.Now,the government has banned onion exports till January 15 and Union Agriculture Minister Sharad Pawar has assured prices will moderate in a few weeks. Onion imports,to offset the problem,may not be much help either,given the time taken to import and then transport to retailers. However,the reflexive ban on exports which cannot provide anything more than short-term relief and that too in questionable proportions since its never determined how much of the price-fall is a mere psychological reaction needs to be debated. As it happens,the cumulative onion export till November this fiscal is 16 per cent less than that last fiscal. Besides,a comparison with retail vegetable prices as a whole might give the impression that most prices are high enough.Thats not to dispute the impact of bad weather. In fact,what lies behind this mess a repeat of the onion crisis of 1998 is the governments continued failure to build storage infrastructure,particularly cold storage facilities,to hold stocks when the produce is still fresh. If storage infrastructure were invested in across the country,the perennially erratic supply would be stabilised. Without that,crops will waste irrespective of weather and affect supply. Its time to overhaul our agro-marketing infrastructure which is starkly insufficient to meet the needs of a population our size.
