Ban on onion exports, curbs on wheat stocks as govt. battles rising food prices
RBI Governor Shaktikanta Das said that notwithstanding the progress made on lowering inflation, the regulator’s 4% target was yet to be reached. The Reserve Bank kept its inflation forecast unchanged, projecting CPI-based inflation at 5.4% for FY24.
“These stringent and somewhat abrupt measures indicate a knee-jerk approach rather than a well-thought-out strategy," said Ashok Gulati, distinguished professor at the Indian Council for Research on International Economic Relations. “These abrupt measures will impact farmers’ income adversely," he added, calling for a “more rational and dependable trade policy that balances the interests of producers and consumers…" Retail vendors in the Delhi-National Capital Region on Thursday quoted onion prices at ₹60-80 a kg.
The all-India average retail price increase on Thursday was nearly 98% year-on-year, showed data from the consumer affairs ministry. “The prevailing supply crunch in the market owing to the early depletion of stocks from the 2022-23 rabi season and estimated lower output from kharif 2023, coupled with the festive demand, resulted in a synergistic impact on onion prices leading to the rise," Pushan Sharma, director-research, CRISIL Market Intelligence and Analytics, said in a recent report.
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