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High prices of onion- too much hype is not justified- timely actions by government can avoid spiralling prices and save governments. Some suggestions.

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High prices of onion- too much hype is not justified- timely actions by government can avoid spiralling prices and save governments. Some suggestions.
By: CA DEV KUMAR KOTHARI
December 4, 2019
All Articles by: CA DEV KUMAR KOTHARI       View Profile
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High prices of onion- too much hype is not justified- timely actions by government can avoid spiralling prices and save governments. Some suggestions.

Prices of vegetable and onion:

Onion prices sometimes increases significantly. This happens in case of many other vegetables. However, we find that onion attracts lot of attention of all. Prices of other vegetables are also very high but onion is causing tears in eyes of all.

Prices of onion can be easily maintained by proper inventory management by importing or exporting onions as situation demand. However, delayed actions- decisions and implementations causes difficult situations for many.

In fact other green vegetables have more fluctuations in prices because they are more perishable than onions, which have relatively longer shelf life if maintained properly.

Availability of vegetables and onion:

As per information found on websites per capita availability of vegetables in India is estimated about 350 to 370 gm/person/day depending on condition of crops of various vegetable.

Share of onions is about 11%.

Therefore roughly about 40 gm onion should be available per person per day. This is based on assumption that entire production is consumed.

There are many people who do not eat onions at all. If we consider this aspect, then about 50 gm of onion is required by each person consuming onion. Within a family consumption of onion from member to member differ. However, average of 50 gm per day per person eating onion is a fair estimate.

This gives requirement of 1.5 kg per month per member and 7.5 kg per month for a family of five members.

Share of onions in dishes:

If we consider cost of various material and services required to make various dishes, we find that in dishes which require onion content of material will be in range of about 5-10% of material used.

A large proportion of dishes are such which do not require onion.

Therefore, on an average, reasonably one can estimate that onion constitute about 5% of material and services cost.

Recently prices of onion has increased significantly and are reported to be in range of ₹ 60 to 120 per Kg in retail market. This is due to loss of crop due to heavy rains, which is a natural and recurring phenomena.

Prices of many other vegetables are on rise, but onion is news maker and on political agenda in a major way.

Onion content can be reduced:

Onion is used as an item of salad, dressing and also a condiment in cooking dishes. With use of other vegetable as salad and other condiments used in cooking content of onion consumption can be reduced.

At time of higher prices, wise consumers change a mix of consumables so as to optimize costs.

 Substitutes of onion:

There are no exact substitutes of onion however, feeling of absence or inadequacy of onion by onion lovers can be reduced by use of garlic , green onion leaves and bulb, Chives, leeks (the white parts only), shallots etc. which contain a lot of flavor, but may not have strength and pungency liked by onion lovers.

Political hype:

In present times, recent past and long past history also we find that there is very much hype in press and media, oppositions also make a strong issue on prices of onion. It is felt that elections are also lost if the political party is power is unable to control price of onion.

Political hype – example in history:

From Source: https://www.indiatoday.in/india/north/story/sheila-dikshit-onion-prices-215617-2013-10-27

New Delhi

October 27, 2013

UPDATED: October 28, 2013 12:02 IST

Sheila's onion stinker: Delhi CM managed to have the veggie only a week after the price hike

She, perhaps, was trying to tell Delhiites they should not eat onions if they can't afford the veggie.

It's a tear-jerker, but onion can also tickle your funny bone at times. Delhiites on Saturday had a laugh riot when they heard their chief minister talking about the impact of the humble veggie's rising price on her menu. It appears that the skyrocketing cost of onions has hurt the CM the most.

As Sheila Dikshit said she had not been eating the pricey onions at least for a week now owing to its spiralling prices, many wondered what she was suggesting. Dikshit, perhaps, was trying to tell Delhi residents that they better not eat onions, if they can't afford to buy it. Onions are are sold at ₹ 80-100 a kg in the city's retail market.

Diskhit told the media persons that she ate onion on Saturday after a week. "I ate onion today (Saturday) with bhindi (kidney vetch) after a week," said Dikshit while speaking about the arrangements made by the state government to deal with the onion crisis. On Saturday, Dikshit was accompanied by her cabinet colleague Haroon Yusuf, Raj Kumar Chauhan and Arvinder Singh Lovely who also spoke at length about the arrangements by the state government to tackle the problem.

Lovely even compared the price of 2013 with that of 1998 when BJP had to lose the Assembly elections due to the rising price of onion. Lovely said onion was sold around ₹ 100 a kg in 1998 as well, when BJP was in government. The BJP, however, hit out at Dikshit, calling her remark a lie. "It is clear that Dikshit is telling a lie. She knows people of Delhi are angry with her government owing to rising onion prices. It will adversely impact the Congress's poll prospects. That is why she is trying to be emotional," said Vijender Gupta, former Delhi BJP president.

In her briefing, the chief minister said the people have been affected by the high prices of the kitchen staple and exuded confidence that the rates would come down significantly in the next few days.

Both the BJP and the Aam Aadmi Party have been attacking Dikshit over the skyrocketing onion prices. The BJP government was voted out of power in 1998 owing to high onion prices. The Delhi government has taken a few measures to contain the rates, according to Dikshit. She claimed that the results would be visible in the next couple of days. Dikshit said the government would start selling onions at ₹ 55 a kg across the city from Monday by deploying 125 mobile vans. A citizen will be able to buy onions up to 100 kg.

“Onion prices will see a fall in the next 2-3 days. We have taken a number of measures to contain the price," Dikshit said. Asked if the export of onions should be banned, Dikshit said if such a step helps ease the price situation, then the Centre should consider it. "I think the food ministry is thinking of banning the export of onions.”

Unquote:

The above news report is enough to have an insight about repeatedly rise in price of onion over a long period of time and too much hype and political propaganda over it.

 Government authorities regularly collect data about various crops and prices. Natural factors causing high production or lower production are also known beforehand. When there is higher production, falling prices is a concern and in case of loss of crop, increasing prices is a concern. This can be for any items. In case of daily use items timely action should be taken ot maintain reasonable stock by importing and in case of exporting crop. However, decisions are taken late and implementation also take time. Causing lot of hype in media.

Particular about onion:

Arrangements and treatment to avoid impact of heavy rains and floods, on crop should be made and intensified.

Crop protection by providing shades, covering with water resistant cloths or polythene sheets or soft plastic sheets can be provided.

Timely action should be agenda to maintain reasonable inventory and prices to protect interest of producers and consumers both.

Packing of onion in raw form or processed form in vacuumed / air tight packing can be explored and popularized.

Attempt should be made to improve Shelf life of onions by providing damp free, airy store rooms.

Products like Onion paste, onion chutney, onion flakes, onion juice, onion pickles, etc. can be developed to provide alternate forms of storing onion.

 

By: CA DEV KUMAR KOTHARI - December 4, 2019

 

 

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