Minister’s onion remark not in sync with reality

Published: 00:00, Nov 14,2019


RETAIL onion prices went up as India on September 13 imposed a minimum export price for onions. A Bangladesh Tariff Commission member on September 17 said that the prices would go down in 24 hours because of the measures that the government took and onions not being in short supply. In reality, the prices reached a record high. The commerce minister in Rangpur on November 8 said that it would not be possible to push onion prices below Tk 100 a kilogram when the wholesalers’ association on November 7 had set the prices in the Tk 55–90 ranges. The industries minister on Tuesday said in the parliament that the onion price was under control when onions was selling for Tk 150 a kilogram in Dhaka. In view of the empty promises and erroneous and contradictory statements of both the ministers, it will not be an overstatement to say that the government has no assessment of the ground reality and that it has failed to stabilise the onion market.

The annual demand for onions is 24 lakh tonnes, as official records say, while Bangladesh produces 23.31 lakh tonnes. However, 30 per cent of the onions locally produced are damaged during collection and preservation. There is, therefore, a significant deficit that is generally met through import, mainly from India and Myanmar. The crisis this year surfaced when India set Tk 71,821 in minimum export price for a tonne of onions amidst supply disruption fears because of flooding in parts of India’s major onion-growing states. Cashing in on the situation, unscrupulous traders in Bangladesh instantly increased onion prices. The government began open market sales of onions to keep the market stable, but the move failed to leave any impact. The government later imported onions from Egypt, Turkey and Myanmar but that, too, failed to bring down onion prices. A photograph that New Age published on November 9 showed a shopkeeper in Old Town of Dhaka selling onions in fours which are almost always sold by the kilogram. The situation puts the minister’s remark that ‘onion price is now under control’ in stark contrast with the reality.

Instead of denying the reality, the government must make a proper assessment of the onion market and immediately make intervention to contain the price spiral. In so doing, it must ensure that it has an adequate stock of essential kitchen items to control the market in an unexpected situation such as the one that happened because of the Indian move. In future, it must also incentivise onion production to reduce the dependence on the import of onions from foreign markets. The government should generally strengthen its market oversight and regulatory mechanism.

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