Nepal | September 25, 2020

Onion price surges in Nepal after India bans export

Arpana Ale Magar
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KATHMANDU, SEPTEMBER 15

Onion price in the domestic market has seen a steep hike just a day after India banned its export. The Indian government banned export of all varieties of onions yesterday, citing drop in production in the southern states due to excessive rainfall.

Traders in the domestic market hiked onion price by Rs 15 per kg in the wholesale market today.

According to the Kalimati Fruits and Vegetable Market Development Committee, the price of onion reached Rs 75 per kg today from Rs 60 a kg yesterday in the wholesale market.

The surge in onion price was even more pronounced in the retail markets.

Saraswati Shrestha, a retail vegetable vendor from Lubhu, was selling onion at Rs 90 per kg today, while yesterday she was charging Rs 70 a kg.

“I bought onions at Rs 80 per kg today at the wholesale market, so after keeping a margin of Rs 10 I am selling them at Rs 90 per kg,” she said, adding, “But I have heard that some vendors in Lubhu are charging up to Rs 100 a kg.”

Onion price in the domestic market saw a steep hike just a day after India banned its export. The Indian government banned export of all varieties of onions yesterday, citing drop in production in the southern states due to excessive rainfall.

Traders in domestic market hiked onion price by Rs 15 per kg in wholesale market today. As per the Kalimati Fruits and Vegetable Market Development Committee, the price of onion reached Rs 75 per kg today from Rs 60 a kg yesterday in wholesale market.

The surge in onion price was even more pronounced in the retail markets.

Saraswati Shrestha, a retail vegetable vendor from Lubhu, was selling onion at Rs 90 per kg today, while yesterday she was charging Rs 70 a kg. “I bought onions at Rs 80 per kg today at wholesale market, so after keeping a margin of Rs 10 I am selling it at Rs 90 a kg,” she said. “But I heard some vendors in Lubhu are charging up to Rs 100 per kg.”

She claimed that there were wholesale traders at Kalimati who were selling onions at a higher price but she was lucky enough to get them at Rs 80 a kg.

“I can’t understand steep hike in wholesale price overnight.

Since we have to buy it at a higher rate in wholesale, the retail price is also going to be high,” she said. “India’s ban on onion export is a godsend opportunity for a few traders to make a quick buck.”

Meanwhile, Khom Prasad Ghimire, president of Federation of Fruits and Vegetable Entrepreneurs, blames traders for their wrong intention of hiking the price of onions overnight to earn more during this crisis. “It has become a trend in our country whereby traders take advantage of any crisis to raise the price of daily essentials,” he said. “All wholesalers always have stock for at least a week, hence, onions should be sold at the same price for at least that period.”

As there is no commercial production of onions in a large scale in Nepal, the domestic market has to depend on India for vegetables like onions, lemons and potatoes. Thus, any changes in Indian market will surely affect Nepali market. However, it is always the consumers who have to pay the price due to the ill intention of traders, Ghimire stated.

He, however, claimed that it is usually the retailers who increase the price in the market rather than wholesalers. “There are authorities to regulate the wholesale market but the government rarely monitors retail markets.”

Prem Lal Maharjan, president of Forum for Protection of Consumer Rights, has accused traders of promoting black market.

“This hike in onion price is akin to black market activity which has become a trend in Nepal,” he said, adding, “There are no stringent rules and regulations to punish those involved in black marketing due to which it is flourishing.” He further said such issues are raised only during a crisis and when the situation settles down nobody talks about it.

“It has become a habit of consumers to raise their voices and seek changes in policies when prices go up but the moment things normalise everybody stops talking about it,” mentioned Maharjan.

“This is also a result of us being dependent on India for onions. It would not have happened if we had promoted commercial farming of onions.”

In 2008, the government had launched a five-year mission to boost onion production. However, the project failed and the government has not done anything since then.

Meanwhile, Binaya Shrestha, information officer at the Kalimati Fruits and Vegetable Development Committee, said that they have taken action against six traders of Kalimati market today.

“We knew this would happen so, early in this morning along with officials from the Department of Commerce, Supplies and Consumer Protection we inspected the market,” he said, adding, “We found six traders selling onions at a high price.”

As per him, the shops of those six traders have been sealed and they have been asked to come to the department with their clarification within three days. He further said that the price might surge more in the coming days as there is a high chance of onion shortage in the domestic market.

Last year too the domestic market had witnessed a hike in onion price to its highest level when it had reached an eye-watering Rs 230 per kg. Back then, India had banned onion export citing lack of production. The same situation might occur again, added Shrestha.

A version of this article appears in e-paper on September 16, 2020, of The Himalayan Times.

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