Onion prices are unlikely to pinch Indian household budgets this year as the Narendra Modi government has nearly completed the build-up of buffer stock to intervene in case of any unexpected price hike in the market.
Usually, the retail as well as wholesale prices of staple kitchen commodities witness a steep hike in the lean supply season between September and November. To tackle this, the Centre maintains buffer stocks to make price stabilising interventions while supporting farmers.
Earlier this year, the Modi government decided to double the cap on buffer stock of commodities to 2 lakh metric tonnes (LMT) after two consecutive years in which the onion prices touched Rs 100 per kg.
As of 31 July, government agencies, including the National Agricultural Cooperative Marketing Federation of India (NAFED), have procured over 1.8 LMT of onions — 90 per cent of the aimed buffer stock, according to government data.