Govt hopes onion prices would ease in a week
New Delhi: Ruling out the possibility of declaring onion as an essential item, the government on Friday said its prices would ease in a week's time on improvement in the demand and supply situation.
Retail prices of onion have soared to Rs 70-80 per kg in most parts of the country, after dropping to Rs 50-55 per kg a week ago from the same high level due to seasonal shortages.
"There is a seasonal movement in onion prices. However, expectation are that prices will settle down in a week or so on improved supplies," Information and Broadcasting Minister Manish Tiwari said here when asked if the Centre plans to place onion in the list of items covered under the Essential Commodities Act.
While the concern about price rise is appreciable but there is a need to maintain balance when addressing problems that are more structural and systemic in nature, he told reporters after the Cabinet meeting, adding that onion is not an item qualified under the Essential Commodities Act, 1955.
Yesterday, both Agriculture Minister Sharad Pawar and Consumer Affairs Minister K V Thomas had said that onion prices are expected to cool down in next 2-3 weeks on fresh crop arrival. Thomas had ruled out declaring onion as an essential item.
Onion, a politically sensitive commodity, in 2004 was deleted from the list of items covered under the Essential Commodities Act following satisfactory production and stable price trend. Earlier, there were 130 items under the Act.
The Centre has been taken several steps to control onion prices. It has further restricted exports by raising minimum export price of onion to USD 900 a tonne from USD 650 a tonne. It has permitted import of onions to boost local supplies.
The Centre has also issued advisories to states to crackdown on hoarders and speculators responsible for keeping onion prices artificially high.
Onion prices continue to remain high as stored onions are getting exhausted very fast and fresh crop from Southern states are not coming in full swing due to heavy rains.