Collapse in India’s onion prices could leave Modi smarting in election
HIVARGAON/MUJAHIDPUR: A spike in the price of onions has led to the ouster of governments in Indian elections in the past. Now, prices of the staple have collapsed, and many impoverished farmers are saying they will make Prime Minister Narendra Modi pay in next year’s general election.
Steep drops in recent weeks in the prices of onions and potatoes, both staple foods for India’s 1.3 billion people, have badly hit the rural economy in large states.
In interviews with dozens of farmers last week, Reuters reportersfoundresentmentwelling against Modi’s Hindu nationalist Bharatiya Janata Party ( BJP) for not helping support incomes in the countryside, where a majority of the population lives.
“Whatever they do in the coming months, I will vote against the BJP. I won’t repeat the 2014 mistake,” said Madhukar Nagare, an onion grower from Nashik in Maharashtra state, referring to his backing the BJP at the last general election.
In the 1998 state elections, a sharp spike in onion prices led to the fall of the BJP government in the capital New Delhi.
In the 1980 general election, skyhigh onion prices helped former Prime Minister Indira Gandhi dislodge a coalition government that had included politicians who later formed the BJP.
In recent weeks, loss-stricken farmers have staged protests, blocked highways and dumped onions on the road after prices plunged to as low as one rupee (1.4 US cents) per kg for a crop that costs about 8 rupees a kg to produce.
But because of large cuts taken by middlemen, consumers have not benefited from the low prices.
In Maharashtra, the top onion producing state, farm prices have fallen 83 per cent, dragged down by surplus supplies from the previous season’s crop and lower export orders from the Middle East and Southeast Asia.
And in India’s most populous state of Uttar Pradesh, which was crucial in Modi’s election win in 2014, there is a similar problem with low potato prices.
Maharashtra and Uttar Pradesh are both dominated by rural voters and together send 128 lawmakers to the 545-member lower house of parliament. It means that big losses in these two states could either see Modi lose the next election which is due by May or his party be forced to form a coalition government.
Farmers say shortcomings in a government crop support programme, and weak overseas demand have combined to produce the current glut of onions. — Reuters