Limited open market sales of onion is not enough
Following the unusual rise in onion price in the market related to export ban by India on the product, the commerce ministry has taken a crash programme to sell onion through open market sales through trucks at five places in the capital city. In order keep the price of this essential kitchen commodity stable or lowering it, the government has no better solution at hand since the country is heavily depended on imports from India. However, selling rice, lentils or even onion through OMS strategy is not a new phenomenon in Bangladesh, but the sales must meet demand.
The commerce ministry has now decided to bring onion from other countries including Turkey, Myanmar and China. The whole business of importing onion from these countries would take some time and the commerce ministry then very positively have to continue OMS, not just in the capital, but all over the country.
The point, however, the strategy introduced only at five points in Dhaka would hardly help the buyers or impact its price in the market. Given the size of Dhaka and the growing demand for onions there should be at least 10 more spots across the city. If the government is at all sincere about its OMS step, it must increase the number of sales spots not within the periphery of Dhaka; it would have to start required number of such sale centres all over the country to help consumers everywhere.
For the recent price hike of onion there is a logical reason, but not as much. Even before the Indian ban, onion of local or Indian variety was selling at our markets for Tk 50 per kg. The price of local variety was only a little higher. But following announcement of export ban by India, the price has suddenly shot up to Tk 80 per kg, unusually very high when Indian onion is still in the market. The business people in Bangladesh are so, they always remain on the lookout to find pretext to artificially increase price of commodities they trade and once the price of a commodity is upped, it is very difficult to bring it down to its usual affordable price. To tackle the present crisis, the commerce ministry sent a letter to the Bangladesh Bank to take steps to reduce the LC margin and interest rate in onion imports. This should be an effective step.
This is the challenge of the commerce ministry and the government's relevant agencies. That is why the government must always be equipped with ready alternative techniques to tackle crisis of not only onion or rice but of all consumer products.