After India extended its export restriction on Friday, onion prices surged beyond Tk 200 per kg in the local market. The commerce ministry is striving to stabilize these prices.

The ministry has taken steps to combat the soaring prices, such as reaching out to India diplomatically, assigning deputy commissioners to supervise the sales of onions, and looking into alternate import sources.

(Photo : by MANJUNATH KIRAN/AFP via Getty Images)
After India extended its export restriction on Friday, onion prices surged beyond Tk 200 per kg in the local market.

Official sources claim that the government is also thinking about increasing the amount of onions that are sold at a discount through the Trade Corporation of Bangladesh (TCB).

Positively, dealers said that the early winter local onion variety "Murikata" is beginning to show up in markets, which may lessen the pressure on prices a little. In addition, the market presently sells immature onion leaves.

Onion Price Surge Prompts Government Intervention and International Outreach

According to TCB statistics, local onions went for Tk180-190 per kilogram on Sunday, while imported onions went for Tk160-170. The price did not drop from Saturday, but it did stay the same.

Similar to the current occurrence, the sudden prohibition on onion exports from India in 2019 led to sharp price spikes in the local market, with a kilogram of onions reaching Tk 290.

Senior Commerce Secretary Tapan Kanti Ghosh deemed the recent significant price rises "unacceptable" on Sunday and attributed them to profiteering.

Sources from the commerce ministry said that the authorities have asked the Indian government to lift the export prohibition on onions imported from Bangladesh, specifically on consignments that had opened credit letters prior to December 9.

Read Also: Golden Arches Around the Globe: McDonald's Plans Massive Expansion and AI Integration

Government Initiatives and Market Interventions Amid Onion Price Surge

Deputy commissioners (DCs) have also been given instructions by the government to guarantee equitable rates across the nation.

In addition, the government is thinking of importing onions from other nations including Pakistan, China, Egypt, Turkey, and Myanmar.

In addition, the ministry is attempting to expand the TCB's onion sales that are subsidized.

Officials say that the TCB is currently selling onions on a modest scale and that, should the need arise, they may take this month-long campaign national.

Numerous customers in Dhaka were in long lines at several TCB sales locations, eager to purchase onions. Not everyone, though, was successful in obtaining any.

The Directorate of National Consumer Rights Protection (DNCRP) launched cooking market raids around the nation in response to the price increases. During these operations, 133 shopkeepers were penalized by divisional and district-level teams of the Rights Directorate.

The government's primary goal, according to a senior official in the commerce ministry, is to stabilize the price of this necessary good as soon as feasible. With the start of the local onion harvest, he thought that the price would soon drop.

Senior Commerce Secretary Tapan Kanti Ghosh chastised companies for driving up onion prices following India's most recent export embargo during a seminar on Sunday in Dhaka.

He urged companies not to put profits ahead of reasonable prices and to remember their duty to the general population.

The senior bureaucrat stated at a seminar held in honor of National VAT Day and VAT Week-2023 that his ministry suggests lowering customs charges on necessities to lower their cost for Bangladesh's 170 million citizens.

According to him, rising costs for necessities are a political problem that impacts regular people.

In order to ensure that Bangladeshi farmers receive fair pricing, the ministry is looking into the potential of imposing seasonal taxes on imported necessities that are also produced locally. "It is difficult to control commodity prices by deploying police," he said.

Regarding potential new channels for raising domestic income, he stated that the National Board of income (NBR) may tax online retailers by connecting to the Digital Business Identity (DBID) System.

Related Article: How Businesses and Households Can Prepare for a Soft Landing or a Recession