Team News Riveting
The decision of the Centre to ban export of onion had opened up debate among market experts why the buffer stock was not used to meet the crises at the crucial juncture.
The experts believed that the buffer stocks could have been put to better use instead of banning exports that had given wrong signals. The stock available could have easily bailed out from the present crisis.
The Centre had reportedly built a buffer stock of nearly 60,000 tonnes last year when prices went down. The stock was created to pay better to the farmers when price went down and offload the stocks to soften the price burden when it escalated.
The government is reportedly sending onion from the buffer stocks to some states. It could have been followed across the country. Instead of releasing onion from its stocks to help bring down the prices, it formulated the ad hoc policy and imposed export ban.
“After releasing the stock, the Centre could have waited to observe the result before taking a decision in a haste to impose a ban,” the experts said, adding that the decision not only created panic but also pushed the prices up.
To ban onion export was not a wise move. The main reason is that an ad hoc export policy normally affected the country’s reputation as a credible seller or exporter.
The government could have waited to note the fresh arrivals of the kharif crops, particularly onions, which normally start in the first week of October. By the time, it could have used the buffer stocks. But the government seemed to have overlooked it.
Onion price is a sensitive issue in Indian politics. The Bharatiya Janata Party (BJP) had lost assembly elections in Rajasthan and Delhi in 1998 because of onion prices. It had not returned to power in the capital since then. Congress also lost Rajasthan in 2013 due to surging onion prices.
With election to the crucial state of Bihar due in next couple of months, the government has been wary.
very clear and good article easy to understand. Thank you