Onion tears: Removing the commodity from purview of APMC Act for a year, cap on stockholdings unlikely to help farmers

onionBy Sagar Rabari*

The change in the expectations from the party in power has led to a change in government at the centre. But that has not led to any change in governance and system of governance. The earlier government was booted out on account of inflation and corruption; the slogan of ‘achhe din’ (better days) ushered in a change. But this change is a mere change of faces, not of any fundamental or systemic change. That is why the new government was forced to serve some bitter pill, and increase in onion price was one of them.  After Nasik in Maharashtra, Bhavnagar district in Gujarat ranks 2nd in the production of onions in India. China produces 25 per cent of the world’s onions while India produces 20 per cent, which means that a fifth of the world’s onions are produced in India. Then why does the onion make governments in India cry ever so often?

In truth, it is neither the onion nor the people who make the governments cry. It is their own policies. What are these policies? Very simply, mollycoddle and fuss over corporates and gross neglect of farmers. In the last season, the traders bought onions from the farmers at a floor price of Rs 80 per maund (Rs 4 per kilo) and a ceiling of Rs 200 per maund. It is estimated that the traders’ entire purchase of the season amounted to Rs 100-125 per maund on an average. A farmer, on an average, spends nearly Rs 100 to grow a maund of onions, while some very poor farmers only got around Rs 80. Those same onions are today selling for Rs. 600 per maund!

 Farmers’ desperation:

  • Farm products, specially vegetables, are perishable goods
  • Lack of storage facilities (cold storages) for such perishable items
  • Low or no skills for value addition (i.e.to turn the raw materials into agro-products)
  • Cash needs

 Failures of governments:

  • Storage infrastructure
  • Skills for value-addition
  • Failed to make agriculture economically viable.

Requirements of farmers/farm sector:

  • Godowns and cold storage facilities in the villages to store products during the season (when prices are low)
  • Simple (in terms of procedure) and affordable credit against their produce
  • Skill training for value addition
  • Accurate and real time data / information about markets and production.
Sagar Rabari

How many cold storages or godowns are there in the villages of Gujarat? Why are they negligible? Because setting these up does not result in ‘big bucks’ for anyone. Then again, if these facilities are put up and farmers start to benefit, why will they sell their land? It farmers do not sell their land, how will industries be put up? If industries cannot be put up how will people realise legal/illegal ‘windfall gains’? And that is the reason why successive governments have been unwilling to find permanent solutions to this problem. Let the farmers and the poor suffer; their business of dealing in lands must go on.

Ragtag solutions, no permanent cure

Removing onions from the purview of the Agricultural Produce Market Produce Committee (APMC) Act for one year, and putting a cap on stockholding are merely meant to convey a sense of proactivity on the part of the government, and misleading. Can anyone say that prohibition in Gujarat has led to an alcohol-free Gujarat? Then how can we assume that a cap on stockholding will make the traders offload all the excess stock of onions in the market? The traders will find their own answers but come September (the season for fresh stock of onions) these traders will cite this as the reason for not buying the stock.

Where will the farmers go then? Will the government be able to provide any alternate arrangement in these two months? What is the meaning of ‘the farmers can sell anywhere’? Will they now be required to sell it door-to-door? A farmer of Mahua, Bhavnagar will go to Himmatnagar to sell his stock? Will the government buy it? Will they sustain the farmers by providing them loans against their stock? What will the government do? How will production increase when land under agriculture is shrinking? Till the government thinks of the difficulty of availability of food for an increasing population and long-term solutions for the same, the humble onion will continue to make governments cry.

*Secretary, Gujarat Kheduj Samaj

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