When Vegetable Prices Blow Up

The government’s strategies to tame vegetable prices are misplaced in both scope and coverage.

 

Volatility of food prices is so commonplace in India that even government responses to it have assumed a rather languid demeanour, not going beyond the verbose promises of improving the farmers’ lot. In the past few weeks, however, skyrocketing vegetable prices across the country, especially that of onion, have created much flurry in the policy circuit. But, this hyperactivity has not transcended the conventional strategies of imposing a minimum export price (MEP) on the exporters and/or a stocking limit on the domestic traders, something that we have already seen this government doing in 2017 to douse the raging retail prices of onion and tomato, then at₹ 80 a kilogram (kg) and ₹ 110 a kg, respectively. Interestingly, it is not the seasonality of vegetable prices per se, but their exacerbation in almost every alternate year that makes the government in power uncomfortable. While the reasons for such escalations are usually interpreted, particularly by the policymakers, as something beyond their control, it is hard to ignore that the conveniences of projecting such official “helplessness” are many.

First, it helps shroud years of inaction behind the “urgent” actions. This, in turn, makes the years of accelerated price spikes appear as some isolated phenomenon, rather than a structural malaise. Second, it justifies the contradiction in the government’s promises and actions. A government that makes grandiose proposals like “one nation, one market,” can impede farmers’ access to remunerative markets (export markets in the case of onions) in practice, just for the sake of gaining quick control of prices. Third, “helplessness” resonates well with the general feeling of the middle class—a pivotal vote bank of the ruling party—operating under binding budget constraints. But, most disconcertingly, this paradigm of emotive politics is laden with the risk of relegating the significant to the periphery. For instance, fundamental issues, such as why the government’s price control policies fail to envision farmers as “net buyers” and/or consumers of food, or how “consumer friendly” the projected “consumer bias” in such policies in reality is, etc, are muted in the public discourse. Whereas, ground-level evidences put a big question mark on the veracity of such projection.

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Updated On : 1st Nov, 2019

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