Govt's subsidised supply fails to stop India's onion tears

The humble onion is refusing to soften the strain on India's household budgets, with retail prices staying elevated across major cities despite the Centre stepping in with subsidised supplies from its buffer stock, news agency PTI reported on September 22.

Onion prices in retail markets across metro cities ranged between Rs 53 and Rs 60 per kg on Tuesday, even as the government continued selling the kitchen staple at Rs 35 per kg to contain prices.

The all-India average retail price of onion stood at Rs 54.2 per kg on September 22. Prices varied widely across the country, with the maximum recorded at Rs 100 per kg and the minimum at Rs 29 per kg.


Data from the Consumer Affairs Ministry showed Delhi recording the lowest retail price among the metros at Rs 53 per kg. Mumbai followed at Rs 58 per kg, while Kolkata and Chennai reported the highest rate at Rs 60 per kg each.

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Private trade data, however, indicated that consumers in some markets were paying more than the ministry’s reported rates.

In Delhi, onion was selling for Rs 60-70 per kg, depending on quality and locality, compared with the ministry’s reported retail price of Rs 53 per kg for the national capital.

Retail onion prices have remained firm despite measures taken by the Centre to increase supplies and check the rise.

The government is releasing onion from its buffer stock at a subsidised price of Rs 35 per kg in Delhi and more than 50 other cities across the country. The intervention is aimed at increasing availability in price-sensitive markets and easing pressure on retail rates.

The Centre has built up a buffer stock of 1.21 lakh tonnes of onion for 2026. The stock is being managed by the government’s nodal agencies, the National Cooperative Consumers’ Federation (NCCF) and Nafed.

These agencies are transporting onions from producing states to consumption centres in bulk. Supplies are being moved both by road and through a dedicated railway service known as the “Kanda Express”.

The logistics push is intended to move stored stocks closer to major consumption markets and strengthen supplies where retail prices are under pressure.

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Under the government’s retail intervention programme, buffer-stock onions are being offered at Rs 35 per kg in selected cities considered sensitive to price movements.

The gap between this subsidised rate and prevailing retail prices remains significant, data showed. In Delhi, for instance, consumers were paying Rs 60-70 per kg in private markets depending on the quality and location, while the government intervention price was Rs 35 per kg.

Rates staying this high despite the release of buffer stocks shows the challenge of bringing prices down across markets, particularly when retail rates differ substantially between locations and sellers, trade anaylists say.