What TV doesn't, print can't; we deliver.
What TV doesn't, print can't; we deliver.
The soaring prices of essential food items, especially garlic and onion, have hit hard on the common people, who are already reeling under the economic and social impact of the COVID-19 pandemic. The retail price of garlic has nearly doubled in the last six weeks, reaching Rs 250 per kg, while the wholesale price ranges from Rs 130-140 per kg. The best-quality garlic commands Rs 220-250 per kg. Onion prices have also surged, reaching Rs 100 per kg in some markets. The retail price of onion varies between Rs 80-120 per kg, depending on the quality and availability.
The spike in garlic and onion prices is mainly due to lower stocks, higher demand, and supply disruptions caused by unseasonal rains and floods in the major producing states. December typically sees a rise in garlic prices, as the new crop arrives in January. However, this year, the situation is worse, as the production is expected to be lower than the normal level. Onion prices are also affected by crop damage and the export ban imposed by the government.
Garlic and onion are staple food items for most Indian households, and their high prices have a direct impact on household budgets and food inflation. According to the latest data from the Ministry of Statistics and Programme Implementation, food inflation rose to 4.96% in October, from 4.54% in September. The RBI has projected a CPI inflation of 5.4% for 2023-24, with varying rates for different quarters. The RBI has also cautioned that the food inflation risks may contribute to an overall inflation uptick in November and December.
The high food inflation hurts the common people, especially the poor and the vulnerable sections, who spend much of their income on food. It erodes their purchasing power and reduces their consumption of other goods and services. It also affects their nutrition and health, as they may compromise on the quality and quantity of food. The high food inflation also harms economic growth and the fiscal deficit, as it reduces the aggregate demand and increases the government expenditure on subsidies and welfare schemes.
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The government should urgently implement effective measures to combat food inflation and alleviate the burden on the general population. Key steps include increasing the supply of essential commodities through the release of buffer stocks, and imports, and incentivizing farmers. Regulation of commodity prices, crackdowns on hoarding and black-marketing, and ensuring a transparent market mechanism are crucial components too. Additionally, improvements in storage, transportation facilities, and overall agri-infrastructure are imperative.
Concurrently, the government must provide relief and support to consumers, especially focusing on the poor and vulnerable. This involves expanding the public distribution system’s allocation and coverage, ensuring essential commodities reach those in need. Direct cash transfers or subsidies are also vital to alleviate the financial strain on affected individuals and families.
To ensure long-term stability and preempt future shocks, a proactive approach is necessary. This entails monitoring and forecasting food inflation trends, enabling timely and preventive actions. Staying ahead of potential fluctuations helps the government avert sudden market shocks and maintain a stable economic environment.
The government has the responsibility and the capability to ensure food security and price stability for the common people. It should act swiftly and decisively to bring down food inflation and restore the confidence and well-being of the people.
