Of onions and rupees
S Madhusudhana Rao
What has rupee and onion in common? Strictly speaking, nothing. But of late, they are vying with each other to overtake in value race. The inorganic rupee and the organic onion are moving as fast as possible in opposite directions. While the former has chosen the downward trend the latter, upward movement. Nevertheless, their individual or combined impact on the people is the same in value terms.
Thanks to the global manufacturing hub China and its continuing currency turmoil, rupee has fallen to over Rs 66/dollar and the Indian stock market plunged into an abyss. Even if we brush off the Monday massacre on the bourse as investors’ problem, the common people’s concern is the falling value of rupee and its purchasing power at local market. For example, how many onions can you buy with one rupee? If you are lucky, you may get an onion bulb weighing a few grams.
On Sunday, a kg of onions retailed at over Rs 70 in Hyderabad. In the national capital, they were priced at over Rs 80 and in a few days, the onion price is expected to touch Rs 100 a kilo! Old timers would recall that at one time it was the cheapest in vegetable markets in any season. Now, it is so pricey that hotels and restaurants have stopped serving onion as an accompaniment to the main course at lunch and dinner!
Is there any relation between depreciating rupee and appreciating onion? Surely, it needs some painstaking study. While the rupee value is linked to global currency markets, onion is a 100 per cent home-grown product. Its wild price fluctuations and acute shortages are nothing to do with rupee’s yo-yo behavior. However, a close look at the rupee and onion’s upward and downward movements suggests there may be an inexplicable mysterious link.
Nevertheless, a periodical onion crisis points to something more than what makes us cry over the skyrocketing prices: It is the looming agrarian catastrophe, caused by south-west monsoon failure and governments’ faulty farm policies. Now, it’s only the onion price; later, it is feared, the prices of all essentials, such as pulses, grains, vegetables, fruits, etc. will go up. Even the bottled water cost will rise if rains give us a miss.
Governments’ quick-fix solutions like subsidized supplies to unaffordable people and imports to ease shortages can mitigate consumers’ problems. But they are not permanent solutions. What we need is a long-term sustainable plan to resolve not only the annual onion shortage but also the seasonal problems of plenty and scarcity through judicious management of production-storage-distribution system in the country.
A case in point is the ongoing onion crisis. Why do we face it year after year? Sometimes, it is state-specific and some other time nation-wide. There are umpteen reasons. Some of these proffered by leaders and officials don’t cut many onions: Crop failure (none can question it); unseasonal or lack of rains (blame them on the Rain God); exports ignoring domestic demand (dollar is more precious than onion); and simply a seasonal problem (really?).
For a decade or so, we have had the onion crisis; first, once in two three years and later almost every year. Still, officials/governments have not laid out a strategy except shedding a few tears. Often, market forces and hoarders had a field day, letting the prices soar. Once they reach the sky, the union government starts thinking of remedial measures by way of imports from countries like China and Pakistan and as far as Iran.
The problem is not the price but the onion quality and its shelf life. If buyers could recall, many consignments of imported onions were rejected because either the onions had rotten by the time they reached our shores or been found unsuitable for human consumption after reaching the market yards. In some cases, they were found inferior in quality to locally produced varieties. In fact, the Indian onion is said to taste better (stronger punch) than others and in overseas markets it commands a premium over others. The smell and the taste are the two overriding factors for rejecting the imported stuff. That begs us to ask the government why it can’t avert a crisis of sorts beforehand.
Meanwhile, the bulbous favourite of millions of Indians has become a prime target for thieves and robbers in Maharashtra. At two separate places, robbers trucked away 700 kg of onions from a Mumbai shop and 2,000kg from a farmer’s storehouse in Nashik district in as many days. If the trend continues, insurance companies can offer onion cover to dealers and farmers.