Onions are expensive. . Rising prices of both essential commodities are troubling consumers and upsetting household budgets. Yet the government’s approach to bringing down their prices could not be more different.
To cool onion prices, the government is releasing buffer stocks and selling them at nearly half the prevailing market price. But there is no such administrative intervention to control sugar prices.
Why not sell sugar too at half the market price and offer consumers the same relief? Why does the government’s policy on measuring and controlling inflation appear to follow a double standard? Why are there different rules for products linked to the powerful and for those produced by farmers?
Onion prices in the open market have climbed to Rs 60–70 per kg. To bring them down, the government is preparing to send onions procured by NAFED to cities
These buffer-stock onions are being rushed onto the market at Rs 35 per kg, roughly half the prevailing price, to provide relief to urban consumers and cool the open market.
But when sugar prices in the same country rise sharply, from Rs 45 to Rs 70 per kg, why do the wheels of policy suddenly slow down? Why is the government not taking the equally bold decision to sell sugar at Rs 35 per kg, just as it is doing with onions? If there can be a Kanda Express, why can’t there be a Sugar Express?
Behind this difference in policy lies the game of political and economic clout.
In major sugar-producing states such as Maharashtra, Uttar Pradesh and Karnataka, many cooperative and private sugar mills are directly controlled by, or closely linked to, powerful politicians across the ruling and opposition parties, including ministers, MLAs and MPs. The sugar industry is among India’s strongest, richest and most organised political lobbies.
That is why, even when , the government does not take a major step such as selling it directly through government counters at half the market price, as it is doing with onions. Instead, it remains confined to relatively limited and slow-moving measures on paper, such as fixing monthly release quotas for mills or imposing stock limits.
The government avoids any aggressive intervention that could directly hit the pockets of sugar mill owners or dent their substantial profits.
The ordinary onion farmer, in contrast, is unorganised. He does not vote as a farmer, nor does he have a powerful political lobby capable of influencing policymaking. That is why governments face little hesitation or fear in forcibly pushing down the prices of his crop, even if it means hurting his earnings.
This is one of the country’s biggest and bitterest contradictions. Industrial products and agricultural products appear to be weighed on two different scales.
Companies making cement, steel, mobile phones, cars, medicines or even a packet of biscuits add their costs and desired profits to fix the maximum retail price, or MRP, of their products. When international prices or the cost of raw materials rise, these companies raise their prices without hesitation, and consumers pay more.
Yet the government seems reluctant to treat inflation in industrial products as inflation in quite the same way.
Has the government ever deployed its own vehicles and begun selling cement at half the market price to bring down the price charged by a private company? Has it ever carried out such administrative intervention to curb the profits of a mobile phone company?
No. There, rising prices are accepted as the rules of the market. But when a farmer’s profit rises, it is turned into the villain of inflation.
Farmers buy fertiliser, high-quality seeds, pesticides, tractors and diesel from companies at high and largely fixed prices. But when the same farmer comes to the market to sell the produce that represents six months of hard work and investment, the government cracks the whip through price caps, export bans, steep export duties and the release of buffer stocks.
It is because of such government controls over agricultural prices, the argument goes, that the average income of an Indian farm household remains just Rs 10,218 per month.
A report by the Organisation for Economic Co-operation and Development, or OECD, also lays bare the consequences of India’s agricultural policies.
According to the argument cited here, Indian farmers suffered losses of Rs 111 lakh crore over the 25 years between 2000 and 2025 because consumer-centric policies prevented them from receiving fair prices for their crops in line with global markets.
The contrasting treatment of onion and sugar prices clearly reflects a policy of one country and two sets of rules — a policy that is overwhelmingly consumer-centric.
Policymakers can see the tears of the consumer. But they do not seem to see the blisters on the feet of the farmer who toils in scorching heat, biting cold and unseasonal rain, or the exhaustion in his eyes after spending months working the soil.
When onions were selling for Rs 2 per kg for months, there was no saviour for the farmers. No one compensated them for their losses, and there was no guarantee of a minimum price.
But now, when farmers have finally begun to hope that they might earn a little money, the government has stepped into the market to push prices down.
The government is opening its buffer stocks and selling onions at just Rs 35 per kg, roughly half the market price, to please consumers by cutting into farmers’ profits.
This amounts to openly crashing the market through what the original argument describes as “predatory pricing” — selling goods at below-market prices to bring prices down. If that is the case, then where is the Competition Commission?
If the government genuinely wants to ensure that poor consumers have access to cheap food and vegetables, it should bear the full cost through its own budget and treasury as a subsidy.
The government should buy crops from the open market at prices that are fair and profitable for farmers, allowing them to prosper. It can then distribute those stocks to poor consumers at subsidised prices through ration shops or mobile vans, bearing the loss itself.
But without spending a rupee from its own pocket, using only the farmer’s rightful profit to subsidise cheap prices in cities and earn political applause is a double-standard policy that will keep India’s food producers indebted and vulnerable.
Until this consumerist approach is changed and farmers are treated as respected business partners within the country’s policy framework, this game of one country and two sets of rules will continue.
And agricultural policy will keep doing what it has done for far too long: cutting into the farmer’s pocket.