A worker sorts onions at a wholesale vegetable market in Chandigarh. (Reuters photo)
As onion prices skyrocket in markets across India, the central government has decided to import the vegetable and has floated a tender for 10,000 metric tonnes which will open on August 27.
To increase the availability of onions in domestic market the government has also decided to raise the Minimum Export Price (MEP) of onions further to $700 per metric tonne from the previous $425.
MEP is the rate below which no exports are allowed. The rise in MEP restricts exports and improves domestic supply.
Onion prices have risen unabated in the past few weeks. Wholesale onion prices today touched Rs 57/kg at Lasalgaon in Maharashtra, Asia's biggest onion market. In Delhi retail prices shot up to Rs 75-80/kg and in Mumbai to Rs 65/ kg.
Until a few weeks ago Saroj, resident of South Delhi used to buy 4 kg of onions for her family of six but with spiraling prices, she can now buy only half of it. She also travels to the Mandi (wholesale market) instead of buying from the neighbourhood vendors in the hope to save some money.
The Delhi AAP government has set up fair price shops and mobile vans to sell the vegetable at a subsidised rate. But these stalls often run out of stock leaving many people waiting empty handed in long queues.
"Prices of onions have been rising on account of a decline in total production from 189.23 lakh tonnes in 2014-15 as against 194.02 lakh tonnes in 2013-14 i.e. a decrease of 4.79 lakh tonnes," the Consumer Affairs Ministry said in a statement.
The shortfall has primarily been on account of adverse weather conditions, including unseasonal rains which have impacted both the standing and harvested crop at major producing centres, it added.
Onion exports fell to 10.86 lakh tonnes in 2014-15, from 13.58 lakh tonnes in the previous year.
The Consumer Affairs Secretary will on Monday take stock of the situation with agencies SFAC, NAFED, MMTC and the Delhi government.