Onions are considered an indispensable ingredient of most Indian cooking and are regarded as a basic right throughout the country.  They are also regarded as a sensitive political issue governments and have made governments such as BJP Govt collapse in 1998. In Aug 2013 prices soared from Rs. 40 per kg to Rs. 60 per kg within a week. This article throws light on onion production in India,Why did onion price rise in Aug 2013, how onions have made government fall and some jokes , tweets on onion.

Onion production in India

India is the second largest onion producer in the world, after China. 45% of the onion produce in India comes from the states of Maharashtra and Karnataka. Maharashtra’s onion production accounts for almost 25% of country’s output, impacting prices around the country. Nashik district alone accounts for 80% of Maharashtra’s production. The country’s production in fiscal year 2013 was 166.45 lakh tonnes and Maharashtra’s production was around 47.63 lakh tonnes. Asia’s largest onion market is in Lasalgaon.

India also exports onions. India, a key supplier to Asian and Gulf countries, exported 511,616 tonnes in the first three months of the current financial year, amounting to Rs. 776.47 crore in the first quarter of the fiscal year against 517,274 tonnes in the year-ago period. But exports are falling due to higher prices and as new season supplies have started from China and Pakistan.

Onion prices rise in Aug 2013

The prices soared from Rs. 40 per kg to Rs. 60 per kg within a week, as rate of wholesale prices shot to of Rs. 5,500 per quintal against the normal rate of Rs. 1,500 per quintal. Television channels and other media hyped the 100 rupees per kg fear which prompted consumers to buy more and advance purchases.

The onion crisis gripping the government might be largely man made. Slow release of onion stocks by a clutch of traders rather than a shortfall in production has emerged as a key reason for retail prices rocketing to Rs 70-80 a kg. The government uncovered the plot hatched by traders operating from major onion markets in Nashik in Maharashtra. As the prices showed signs of correction, government is unlikely to take the extreme step of banning export of the commodity.

From TimesofIndia Hoarding pushing onion prices up, govt finds

The math that puzzled officials was: Though onion production in 2012-13 declined only 5% and storage was less by just 2 lakh tonnes, market arrivals fell steeply by 20-40% in June-July 2013. The declining arrivals made even less sense as the National Horticulture Research and Development Foundation reported onion stocks at a healthy 8-9 lakh tonnes — sufficient to meet demand till the kharif crop reaches markets. The price manipulation was traced to the doorstep of traders controlling release of onion stocks to Nashik’s major markets of Pimpalgaon and Lasalgaon where rates are threatening to breach the Rs 5,000 a quintal mark.

Why Onion prices matter?

Onion prices have been an important political issue, Onion prices can make or break governments.

1980: Rising Onion prices in 1980 helped Indira Gandhi to topple India’s first non-Congress government, Janata government.

1998: Anger against rise in Onion prices was regarded as the decisive factor in the 1998 state elections in Delhi and Rajasthan In 1998, onion prices touched Rs.40 per kg in the retail market and resulted in Sushma Swaraj, then chief minister of Delhi. losing the assembly elections.

2010: The crisis caused political tension in the country and was described as “a grave concern” by Prime Minister Manmohan Singh.  The Indian onion crisis of 2010 describes the dramatic rise in the cost of onions across markets in India. The crisis was caused by errant rainfall in the onion producing regions which led to a shortage of onion production. In November 2010, unseasonal rainfall in onion-producing regions such as Nashik in Maharashtra delayed the arrival of onions in markets. In December, when fresh crop usually begins to arrive, onion shipments were reduced to 700 to 800 tons a day from 2000 to 3000 tons a day in New Delhi markets, raising the price of onion rose from Rs 35  toRs 88  per kg in the period of one week Ref: Wikipedia 2010 Onion crisis

Aug 2013: In Aug 2013 The Bharatiya Janata Party (BJP) and the anti-corruption Aam Admi (Common Man) parties have opened greengrocery vans in the capital Delhi to sell heavily subsidised onions to embarrass the government and highlight eye-watering price increases. The opposition parties are selling their onions for between 25 rupees and 40 rupees per kilo, while commercial shops have been selling them for between 60 and 80 rupees.

Picture from livemint The great onion price paradox shows How onion prices have been fluctuating over the years.The article also covers in depth yields and onion production over the past decade.

Rise of onion prices

Onion prices : Sale,Protests, Jokes and Tweets

Amul topical on onion

In Kolkata ,Buy a sari for Rs. 500, get a kg of onion free. Ref: Hindustan Times 

In Jamshedpur, onions were given free with the purchase of car and truck tyres . “As the price of onion has gone up to Rs 60 a kg here, we have decided to offer five kg of onion free with the purchase of a truck tyre and one kg on two car radial tyres,” Satnam Singh Gambhir, the tyre seller of Kalimati Road in Sakchi said today. Gambhir, who is the President of the All India Sikh Students’ Federation of Bihar and Jharkhand, had made a similar offer in December 2010 when the price of onion had also risen to Rs 60 a kg. Asked why he was offering onions free, he said it was his protest over the gvernment’s failure to check price rise and depreciation of the currency. Ref: Onions free with purchase of car and truck tyres as protest in India

On Twitter too, people were tweeting their reactions to the price rise that has brought tears to the eyes of many. From Times of India 19 Aug 2013

Onion Peels of laughter

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Will it be Politics dopyaza? Will onions make Indians cry? Will Indians bring down governments? Did increase in onion price impact you? Is taking about onions much ado about nothing? Any jokes you have to share about onions!