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Tuesday, September 22, 2015

the onions in [Delhi] politics and the AAP way of selling !!

The onion (Allium cepa) (Latin 'cepa' = onion), also known as the bulb onion or common onion, is used as a vegetable and is the most widely cultivated species of the genus Allium.

Onions generally make people cry :    As onions are sliced, cells are broken open. Onion cells have two sections, one with enzymes called alliinases, the other with sulfides (amino acid sulfoxides). The enzymes break down the sulfides and generate sulfenic acids. Sulfenic acid is unstable and decomposes into a volatile gas which dissipates through the air and eventually reaches one's eye, where it will react with the water to form a mild solution of sulfuric acid. The sulfuric acid irritates the nerve endings in the eyes, making them sting. The tear glands then produce tears in response to this irritation, to dilute and flush out the irritant.

It was not that property of Onions that made Indians cry …. ~ but it was that of its spiralling increase in prices that often does… a couple of years ago, it reached 100 + making middle-class cry… it was not restricted to the price of onions, they also pushed up inflation up; it caused a change of Govt in Delhi too, politically affecting the fortune of parties in some States.

At a time when onions became the butt of cartoons, Groupon India, home of India’s biggest discounts and best deals online- offered something totally unrealistic and unbelievable.   Around 2011, when onion prices sky-rocketed, the firm sought to boost its popularity by offering a mouth-watering deal by pricing it at Rs 9 a kilo. That was available to limited no. of buyers made their website quite a hit.

Supply and demand is perhaps one of the most fundamental concepts of economics and it is the backbone of a market economy. Supply represents how much the market can offer. The quantity supplied refers to the amount of a certain good producers are willing to supply when receiving a certain price. The correlation between price and how much of a good or service is supplied to the market is known as the supply relationship. Price, therefore, is a reflection of supply and demand. ~that is sound Economic theory, not when there is hoarding, supply getting artificially restricted and hoarders cashing in !  It is always easier to attack the policies of the Govt and tougher when actually managing it ………..and here is a report from MailOnline on ‘Onions and AAP’ :

The AamAadmi Party (AAP) government’s claim that it purchases onions at Rs 40 a kg and sells these to you at Rs 30 a kg has turned out to be a farce.The AAP government, which came to power on the promise of eradicating corruption, has procured onions at a much cheaper price of Rs 18 a kg and sold these to Delhiites at Rs 30 a kg, according to RTI replies. The move, the RTI replies state, is in stark contrast to the Cabinet decision that the government will sell onions at a no-profit-no-loss basis in the Capital.

The National Agricultural Cooperative Marketing Federation of India Limited (Nafed) has alleged that there is a huge difference between the procurement cost and the price at which the AAP government sold onions to Delhiites. The Delhi government, however, ruled out any financial bungling on its part. “If there is any irregularity, it is on part of the central government agencies Small Farmer Agri-Business Consortium (SFAC) and Nafed. The actual procurement cost is Rs 32.86 per kg. "Owing to transportation and labour expenses, it shot up to Rs 40 per kg. The AAP government then decided to subsidise the onion price by another Rs 10 per kg and decided to sell them at Rs 30 per kg,” Delhi’s Food and Supplies Minister Asim Ahmed Khan told Mail Today.

He alleged that Nafed was politicising the issue even when it supplied onions at high prices to Mother Dairy and Safal. RTI replies provided by the Delhi government’s Department of Food Supplies and Consumer Affairs, however, present a different picture. The RTI documents accessed by Mail Today revealed that the government had purchased 2,511 metric tonnes (25,11,000kgs) of onions through SFAC at an average price of Rs 18.57 per kg, which also includes cess and other local expenses. The purchases were made from various markets of Nashik in Maharashtra and Indore in Madhya Pradesh.

However, when the onion crisis aggravated in the Capital, the government on August 5 decided to sell onions at a no-profit-no-loss basis through its vans. The government had also declared that Rs 32.86 per kg as the procurement cost and Rs 7 per kg as the amount of additional surcharge, transportation cost and other local expenses. The Delhi Cabinet chaired by Chief Minister ArvindKejriwal then decided to subsidise the price by Rs 10 per kg and sold onions at Rs 30 per kg. The RTI documents also revealed that the government failed to supply adequate quantity of onions despite having a buffer stock of 5,000 metric tonnes.

The National Agricultural Cooperative Marketing Federation of India Limited (Nafed) has alleged that there is a huge difference between the procurement cost and the price at which the AAP government sold onions to Delhiites. This, according to Nafed, essentially kept the onion prices high even though the government had abundant stock of the multi-layered vegetable. According to RTI replies, the Kejriwal government began the sale of onions on August 10. However, it could only sell 575.32 metric tonnes of onions till September 2. This means that more than 4,400 metric tonnes of onions remained stashed in godowns while Delhiites were reeling under surging prices of the vegetable.

The price of onion skyrocketed to Rs 80 a kg in August and despite the government’s assurances the price never came down below Rs 60-per-kg mark. “There is a huge profit margin in the onion sale. The Delhi government did not supply adequate quantity of onions to the market. Had it had done that the prices could have come down. The AAP government must reveal where the profit margin has gone,” said Ashok Thakur, director, Nafed. He pointed out that the Delhi government had earlier refused to purchase onions even though Nafed wrote to it repeatedly.

This, he said, led to hoarding of onions and prices went excessively high. The BJP said it is the first major scam in the seven-month-rule of AAP in Delhi. Senior BJP leader and Leader of Opposition in the Delhi Assembly Vijender Gupta sought a thorough probe into the matter. He said it is a clear case of financial bungling. “The AAP government has not only resorted to financial irregularity, but also misled the people of Delhi by promising subsidy on onion prices. It is a shameful act. "The government sought to befool the public by earning profit by selling onions. Where has the money gone? It needs to be investigated,” Gupta said. 

The Kejriwal government ignored repeated alerts by Nafed to stock sufficient quantity of pulses and other eatables so as to meet the requirement in case of short supply. And all this happened at a time the Delhi government faced criticism for not procuring onions that resulted in cost escalation. An RTI reply by the food and supplies department of Delhi government said it has not purchased pulses or any other grain and eatable products. The Nafed, which is a Central Government agency, wrote four letters to Delhi government from April to June but the government chose to ignore them. “Nafed offered arhar dal at Rs 54 per kg and chana dal at Rs 38 per kg. Despite four requests, the AAP government did not buzz. "As a result Delhiites are forced to buy arhar dal at Rs 150 per kg and chana dal at Rs 70 to Rs 80 a kilo,” said Nafed Director Ashok Thakur. The letters, copies of which are in possession of Mail Today, were written on April 8, May 1, June 5 and June 30. However, there was no reply from the Delhi government.

Thakur alleged that non-procurement of commodities by the government resulted in hoarding by traders and black marketers as a result of which price of grains skyrocketed.

Lot of confusion …. Onions do make people cry !

With regards – S. Sampathkumar
21st Sept. 2o15
[A joke : Culinary Expert to newly wed woman:  – you will not cry, if you cut onions under water
Woman : …….but … then – how do I breathe !!!]

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