The Maharashtra government has announced an ex-gratia payment of ₹300 per quintal for onion farmers who have been hit by the sharp decline in late kharif onion prices. This follows the overproduction of onions, which has led to a glut in the market and a drop in prices.
The ex-gratia payment has been announced based on the recommendations of a committee appointed to suggest measures to provide relief to farmers. While the committee had recommended an ex-gratia payment of between ₹200 and ₹300, the government has decided to offer ₹300 per quintal.
A report regarding the matter was published in the Hindustan Times.
The government is expected to bear the burden of ₹340 crore for the procurement of 18.9 million quintals. The ex-gratia payment will be for onions sold between February 1 and March 31. The National Agricultural Cooperative Marketing Federation of India (NAFED) has already opened 45 centers to purchase onions and has procured 66,745 quintals as of March 11, at a purchase price of ₹1,034 per quintal.
In addition to the ex-gratia payment, the Maharashtra state government has requested the central government to provide more wagons from Nashik for export to Bangladesh. The government has also requested that the Remission of Duties or Taxes on Export Products (RoDTEP Scheme) on onion exports be increased from the current 2% to 4% to facilitate onion exports.
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The announcement follows protests by onion-growing farmers, particularly those from Nashik and other north Maharashtra districts, who have started to march towards Mumbai, demanding fair prices. Maharashtra accounts for over 40% of the country's onion production, with a production of about 30 metric tonnes. The massive production of red onions has been taken in the late kharif season. Huge production, not only in Maharashtra but also in other states like Madhya Pradesh and Rajasthan, led to a drop in demand for production in Maharashtra.
Some politicians have expressed dissatisfaction with the announced ex-gratia payment. Nationalist Congress Party MLA Chhagan Bhujbal from Nashik has demanded that the payment be raised to ₹500 per quintal. Jaydutt Holkar, former chairman of Lasalgaon APMC, has also stated that the subsidy announced by the state government is just a "hogwash" and that it will not help the farmers recover even their input costs. The procurement by NAFED has also not helped farmers get a good price for their produce as they failed to procure it from Agricultural Produce Market Committees (APMCs). Instead of announcing the subsidy, the government should take steps to increase demand for the produce.
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