The decision of the NDA government to liberalise onion exports is a manifestation of its fear of the commodity that led to the debacle of BJP in Assembly polls in four States, including Rajasthan, Madhya Pradesh and Delhi five years ago. The decision not only indicates that BJP is afraid of onions despite a reversal of situation in the markets, but also reveals that the party is willing to play to the gallery and join the bandwagon of some politicians, farmers and exporters to propagate populist myths about onion exports. Crop cycle Onions are usually grown during Kharif (monsoon) and Rabi (summer) seasons. Kharif onions are harvested around October while Rabi onions are harvested during April. In Maharashtra, Gujarat and Orissa, onions are grown thrice a year. Apart from Kharif and Rabi seasons, onions are grown in the Late Kharif season. Onions grown in this season are harvested during December-January. Onions grown in Kharif and Late Kharif seasons are highly perishable. Five years ago, when the four states went to polls, monsoon failure led to a serious shortfall in onion production causing prices to touch an all-time high of upto Rs 40 per kg in wholesale markets. The countrywide production of onions fell from 42 lakh tonnes to 36 lakh tonnes. When retail prices hit Rs 50 per kg in Mumbai and Delhi, the Centre banned onion exports. However, the BJP faced a humiliating defeat — attributed to the soaring prices — in the four states. Since then, the Union Government has included onions in the list of essential commodities and exports are periodically relaxed, with a quota being released through certain agencies. Over the past five years the situation in the onion markets has, however, changed and almost reversed. After the record rise in prices during 1997-98, the area under onion cultivation increased, raising the annual production to 52 lakh tonnes. This year production is likely to touch a record high of 55 lakh tonnes. Onion exports, which were around 4.5 lakh tonnes before 1998 and had dropped to 2.60 lakh tonnes after the ban, increased to five lakh tonnes last year. Exports are likely to touch a record high of six lakh tonnes this year. Over the past five years, farmers and political parties like Shetkari Sanghatana, NCP, Congress and even Shiv Sena have organised agitations in Maharashtra’s onion belt to demand lifting of all curbs on onion exports. However, probably to be cautious and to play to the popular belief propagated by some politicians, exporters and farmers, the Union Government has liberalised onion exports. The fact is that onion exports have never been more than 10 per cent of production. But, exporters, who lost some of their overseas markets in general and Gulf markets in particular because of the restrictions on onion exports, desperately wanted the liberalisation. Whenever possible, they had bought onions at lower prices while procuring from farmers, on the pretext that export restrictions were responsible for fall in prices. In Maharashtra, which leads in onion production growing about 14 lakh tonnes per annum, production has increased over the past five years. Four years ago, when the Congress-led Democratic Front government assumed office, it chose to intervene in the onion glut and procure onions at prices higher than those prevalent in the market. As against the market prices of Rs 200 per quintal, the government bought them for Rs 350 per quintal to please the farmers, in the process incurring a loss of about Rs 100 crore. Several lakh quintals of rotting onions had to be thrown into ravines as there were no takers. An attempt to sell the commodity through PDS failed as it was cheaper in the open market. Maharashtra’s call for sharing the losses was declined by the Centre for obvious political reasons. Meanwhile, the Union Government decided to create buffer stocks and increase availability of onions. Through the Bhabha Atomic Research Centre, the NDA government has created an onion irradiation centre at Lasalgaon — the biggest onion market located in Nashik district. The BARC centre, built at a cost of Rs 8 crore was inaugurated by PM A.B. Vajpayee recently. However, the irradiation centre — aimed at increasing the shelf-life of the commodity — is yet to become operational. The NDA government also activated agencies like NAFED and National Horticulture Research and Development Foundation (NHRDF) on the issue. Both agencies constructed aerated godowns for storage in onion growing belts. The NHRDF recently announced a plan to increase production from 55 lakh tonnes to 120 lakh tonnes by 2020. The decision to liberalise onion production might ensure onions would be available in abundance and all those connected with it would be satiated. For instance, consumers in Delhi and other states who had raised a hue and cry over soaring prices, would now have no cause to agitate on the eve of polls in these states. In the process, the myth that exports were responsible for the situation in 1998, would be propagated.
