The government anticipates onion prices to decline below Rs 40 per kilogram by January from the current average price of Rs 57.02 per kilogram, Consumer Affairs Secretary Rohit Kumar Singh said on Monday.
Last week, the government banned onion exports till March of next year after the retail sales price of the kitchen staple crossed Rs 80 per kg in the national capital and the prices in mandis remained around Rs 60 per kg.
The export ban will not affect the farmers and it is a small group of traders who are exploiting the differential between prices in Indian and Bangladesh markets.
Onion inflation in the Consumer Price Inflation (CPI) basket has been in double digits since July, rising to a near four-year high of 42.1 per cent in October.
Between 1 April and 4 August this fiscal, 9.75 lakh tonnes of onions have been exported from the country. The top three importing countries in value terms are Bangladesh, Malaysia and the UAE. Onion prices have started inching up amid reports of lag in onion coverage in the ongoing kharif season.
Before banning exports, the Centre, in October, decided to step up the sale of buffer onion stock at a subsidised rate of Rs 25 per kg in retail markets to provide relief to consumers.
To control prices, the government has taken several steps. It imposed a Minimum Export Price (MEP) of USD 800 per tonne on onion exports from 28 October till 31 December 31 this year.
Also, in August, India imposed a 40 per cent export duty on onions up to 31 December.
While the wholesale price inflation in vegetables in October cooled to (-) 21.04 per cent, the annual rate of price rise in onions continued to rule high at 62.60 per cent during the month.
