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Government to create 2 lakh tonnes of onion buffer stock

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The government is planning to buy 2 lakh tonnes of onions for buffer stock in 2021-22 to prevent the price hike and ensure easy availability during festive season when supply is tight.

“In 2019-20, we bought around 57,000 tonnes followed by around one lakh tonnes in 2020-21. In the next fiscal we will buy 2 lakh tonnes to prevent prices going up during festive season,” said consumer affairs secretary Leena Nandan.

She said that the government is encouraging private sector to come up with storage facilities to store onions which are required to be stored at specific temperatures at different stages.

“We are taking every step to control prices of onions which hit the ceiling every year during festive season,” she said.

The government has allocated Rs 2,700 crore in 2021-22 for the price stabilisation fund (psf) used to buy buffer stock of onion and pulses. This is 35% more than the budgetary allocation of 2020-21.

“We will also buy more pulses this year to distribute at subsidised prices. As against 20 million tonnes, we target to purchase 23 million tones in next fiscal,” said another official of consumer affairs ministry.

Meanwhile, the government is planning to achieve zero import of onions from 2021-22 by expanding acreages in non onion growing areas like northeastern states, Punjab and parts of Uttar Pradesh. The rise in area will also increase production which will ease the pressure on onions prices, which go up sharply up to Rs 150 a kg during festive season in October-November every year.

“In 2020-21, we imported around 36,000 tonnes of onions. We will meet this additional domestic demand by expanding acreages in non traditional areas from existing 250 hectares to 1250 hectares. In total, we grow onions across 1.4 million hectares,” said A K Singh, deputy director general, horticulture, Indian Council of Agricultural Research (ICAR).

He said that the government is also working on increasing the productivity of onions from 18-19 tonnes per hectare to 25 tonnes per hectare.

“The domestic demand of onion is around 17 million tonnes a year. A large quantity is exported as there is great demand of onions from Middle East, Bangladesh and Sri Lanka. We need to increase productivity through better seed-bulbs and other scientific interventions for an increased yield. In Uttar Pradesh’s Mirzapur, we have been able to achieve productivity of 25 tonnes per hectare,” Singh said.

The government has also identified 17 districts in the country under One District One Focus Produce (ODOFP) for cultivation and processing of onions. This will promote onion production through cluster approach and increase the income of farmers.

According to the consumer affairs ministry, which tracks prices of food commodities, the price behaviour of onion has nothing to do with production.

“Over the past 10 years, onion production has steadily gone up from 15.1 million tonnes in 2010-11 to 26.1 million tonnes in 2019-20. The annual domestic consumption is around 17 million tonnes. So supply constraint is not the reason for the price hike,” said a consumer affairs ministry official, who did not wish to be identified.

Last year, the government had banned exports, imposed stock limits and placed import orders to ease onion prices.

“The production of onion in 2020-21 is likely to be around 26.2 million tonnes – 50% more than the domestic requirement. So farmers will be able to earn more through exports and at the same time, consumers at home will be able to get the kitchen staple at affordable price,” the consumer ministry official said.

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