Onion prices at retail level have doubled in the space of just 10 days, following India’s withdrawal of incentives on onion exports for its farmers. Consumers though smelt a local conspiracy amid old suspicions of ‘syndicates’ - powerful networks with presence throughout a supply chain, who work to manipulate the market.
A look back through the timeline of events however, supports the view that the price movements here are indeed the consequence of policy measures in our neighbouring state.
On June 11, the Indian government withdrew the incentive for the Indian exporters of onions, with the intention of shoring up the Indian market and bringing prices down after they skyrocketed.
It used to allow exporters to get a 10 percent incentive on the free on board (FOB) prices realised from overseas importers. The incentive scheme was anyway set to expire on June 30 but was brought forward.
In Benapole land port, the import of Indian onions reduced three-fold in June. Consequently, the price shot up in the big markets of Benapole, Sharsha, Navaron, Bag Anchra and Goga area.
Citing that dishonest traders and importers are in cahoots raising the onion price, customers here urged the authority to monitor local markets. Inspector of the land port Nazrul Islam said in last 10 days of the previous month, 1770 tonnes of onions were imported through Benapole land port. But in first nine days of the running month, only 459 tonnes of onions came through.
According to the Commerce Ministry, annual demand for onions in Bangladesh ranges between 2.2 and 2.5 million tonnes. Although the country’s own annual production of onions has risen, so has the imported amount gradually over the last decade.