To contain onion prices, the Centre on Friday imposed stock holding limit on retail and wholesale traders till December 31 to improve the domestic availability of the commodity and provide relief to consumers. Retailers can stock onion only up to 2 tonne, whereas wholesale traders are allowed to keep up to 25 tonne, Consumer Affairs Secretary Leena Nandan said in a press conference.
She said the government had to invoke the Essential Commodities (Amendment) law -- which was passed last month in Parliament -- that allows it to regulate perishable commodities in the extraordinary price rise situation.
Later, Consumer Affairs Minister Piyush Goyal tweeted: "To control rising onion prices and curb hoarding, PM @NarendraModi government has taken the third step. Imposed stock limit of 2 tonne on retailers and 25 tonne on wholesalers".
Onion prices have shot up sharply to over Rs 75 per kg in the last few weeks in the wake of damage to standing Kharif crop in producing areas due to heavy rainfall.
This comes after the government on Wednesday relaxed import norms till December 15 to facilitate the early shipment of onion to boost the domestic supply and check the retail prices of the key kitchen staple.
The Union Consumer Affairs Ministry, in a statement, said it will also offload more onion from its buffer stock in the open market to contain price rise.
An estimated Kharif crop of 37 lakh tonne is likely to start arriving in the Mandis that will give reprieve to the rising prices, it added.
According to the ministry, a sharp spike in onion prices in the past 10 days by Rs 11.56/kg has taken the all-India retail price of the commodity to Rs 51.95/kg, which was 12.13 per cent higher than the last year's price of Rs 46.33/kg.
The retail price of onion has shown a marked increase from August-end 2020, though the price level was below that of last year till October 18, it said.
To facilitate import of onion, the ministry said, "the government has on October 21 relaxed the conditions for fumigation and additional declaration on Phytosanitary Certificate (PSC) under the Plant Quarantine Order (PQ), 2003 for import up to December 15, 2020".
The Indian High Commissions have been instructed in the relevant countries to contact the traders to push for greater onion imports to the country.
Such consignments of imported onions, which arrive at Indian ports without fumigation and endorsement to that effect on the PSC, would be fumigated in India by the importer through an accredited treatment provider.
If Stem and Bulbs nematode (Ditylenchus Dipsaci) or onion maggot (Hylimia Antiqua) is detected it would be eliminated through fumigation and the consignments to be released with no additional inspection fee.
"An undertaking will be obtained from the importers that the onion will be used only for consumption and not for propagation," the ministry said.
Such consignments of onions for consumption will not be subjected to four times an additional inspection fee on account of non-compliance of conditions of import under the PQ order, 2003, it added.
In order to moderate prices, the ministry said that onion from the buffer stock is being released in a calibrated manner from the second half of September 2020 to major mandis, retail suppliers such as Safal, Kendriya Bhandar, and NCCF as well as state governments.
"More will be done in the coming days," it added.
In September, the government said it had taken a pre-emptive measure by announcing a ban on onion export to ensure availability to the domestic consumers at reasonable rates during the lean season before the Kharif onion arrival.
While the rate at which retail prices increased had been "moderated to some extent", recent incidents of heavy rainfall in onion growing districts of Maharashtra, Karnataka, and Madhya Pradesh had "caused damage to standing Kharif crop, stored onion and seed nurseries," the ministry said.
"These developments on the weather front have resulted in sharp increase in onion prices," it added.