State announces ex gratia of ₹300 a quintal for onion amid dip in prices

Chief minister Eknath Shinde made the announcement in the legislative assembly on Monday. “The glut in the production has led to the drop in the prices. Since it is a perishable product, it does not come under the minimum support price cover

Mumbai: The Maharashtra government on Monday announced ex-gratia of ₹300 a quintal to the onion farmers in the wake of the sharp plummeting of the late kharif onion owing to the massive production. The state government is expected to bear the burden of ₹340 crore for the procurement of 18.9 million quintals.

Nashik, India - March 13, 2023: Farmers protest and throw onions and tomatoes on road as they participate in a foot march that is going to Mumbai from Nashik, India, on Monday, March 13, 2023. Ravindra Rajput (Hindustan Times)

Chief minister Eknath Shinde made the announcement in the legislative assembly on Monday. “The glut in the production has led to the drop in the prices. Since it is a perishable product, it does not come under the minimum support price cover. The ex-gratia announced is on the basis of the recommendations given by the committee appointed to suggest the steps to give respite to the farmers,” he said.

Shinde added that the committee had recommended the ex-gratia between ₹200 and ₹300. “We have decided to offer ₹300 a quintal,” he said.

Anoop Kumar, additional chief secretary, of cooperation and marketing, said, “The ex-gratia is for the sale of the onion between February 1 and March 31 and the government is expected to bear the cost of ₹340 crore. NAFED has opened 45 centres to purchase the onion and has procured 66,745 quintals till March 11, when the purchase price was ₹1,034 a quintal,” he said.

The announcement comes in the backdrop of the protests by onion-growing farmers, especially from Nashik and other north Maharashtra districts. The farmers have started to march from Surgana in Nashik and are marching towards Mumbai demanding fair prices. Maharashtra produces about 30 metric tonnes, which is over 40% of the country’s production. The massive production of red onion has been taken in the late kharif.

Huge production not only in Maharashtra but even in other states like Madhya Pradesh Rajasthan led to a drop in the demand for production in Maharashtra. The demand from Bangladesh and Sri Lanka also plummeted because of central policies related to import/export duties, according to the farmers. The procurement prices of onion had dropped to ₹500 a quintal early this month from ₹850 weeks before it.

Nationalist Congress Party MLA Chhagan Bhujbal who hails from Nashik has expressed his unhappiness over the announcement and demanded it is raised to ₹500 a quintal.

Jaydutt Holkar, former chairman of Lasalgaon APMC, said, “The subsidy announced by the state government was just a hogwash and it would not help the producers to recover even the input cost of the farmers. The onion is being procured at ₹850 a quintal against its input cost of around ₹1,200. The procurement by NAFED has not helped farmers in getting a good price for the produce as they failed to procure it from APMCs. Instead of announcing the subsidy the government should take steps that would facilitate more demand for the produce.”