THE SOARING price of onions across India, which in the past has been an issue over which federal and provincial governments were voted out of office, is now threatening prime minister Manmohan Singh’s administration.
A staple ingredient in almost all kinds of Indian food, onions have been selling in Delhi and other northern cities in recent days at 60 rupees (€1.02) per kg, up from 30 rupees, registering a 100 per cent increase.
Enterprising traders across the country were even offering kilos of free onions along with the purchase of each tyre, television and any other electrical item.
Facing mounting public anger over such inflated costs, Mr Singh’s Congress Party-led federal government had scrapped all tax on onion imports and banned its export to try to control prices.
Heavy unseasonal rains were officially blamed for pushing up onion prices. But economic analysts say poor agricultural productivity, transportation and inadequate state investment in agriculture are responsible for the crisis.
India, meanwhile, was trying to persuade neighbouring Pakistan to resume onion exports as food inflation was weighing heavily on the country’s economy and fuelling public anger at Mr Singh’s federal coalition.
Last week Islamabad had banned onion exports to India, fearful of creating shortages at home. “We have initiated talks and before not too long we are hopeful of finding a solution to easing pressure with regard to high onion prices,” said foreign minister SM Krishna.
The government is mindful that the high cost of the food could easily escalate into a significant political handicap. In the past the inflated price of onions has triggered violent street protests leading to electoral failures.
In 1980 Indira Gandhi exploited rising onion prices to oust the now defunct socialist Janata Party and storm back to power.
She appeared at election rallies waving huge strings of onions with the message that a government incapable of controlling their cost had no right to govern.
In 1998 a six-fold surge in onion prices was held responsible for the electoral defeat in Delhi’s state polls of the ruling Hindu nationalist BJP.
India’s food inflation rose by 18.3 per cent for the fifth straight week, ending December 25th, 2010. It was the highest in more than a year, reinforcing fears that it would further damage Mr Singh’s image as a respected economist and enabled the opposition to attack the government.
In an indication of public disenchantment with the authorities over corruption and high onion and general food prices, a poll released last Friday revealed the Congress Party would lose its parliamentary majority if an election were imminently held.
The Mood of the Nation poll, conducted by AC Nielsen and the weekly India Todaynewspaper, showed the Congress Party would drop about 40 of its 206 seats in parliament.