The onion has a surprisingly weighty track record of political influence. In January 1980, Indira Gandhi exploited rising onion prices to storm back to power, appearing at campaign rallies waving huge strings of them with the message that a government that can’t control onion costs has no right to govern. And in 1998, a six-fold surge in the cost of onions was held partly responsible for the electoral defeat of the ruling Delhi state government.
Are onion price hikes manipulated to justify the approval for FDI in multibrand retail?
In Tehelka, Devinder Sharma writes that though in September this year government banned the export of onions, eleven days afterwards the powerful traders lobby forced the government to lift the ban. He pointed out that traders hold the key to the political purse, and a crackdown against hoarding and speculation would mean chopping off the financial cord, recording that:
“While commerce minister Anand Sharma rejected the argument that there was a link between the soaring onion prices and the opening up of multibrand retail to FDI, the demand for liberalising the sector has been intensifying, especially in the wake of wide gap between the wholesale prices and retail prices.”
Devinder Sharma reports from Delhi that India is under pressure from the G20 leadership to remove all barriers in opening up to multibrand retail and that the Indian government has made a deliberate effort to establish that the only option to bring down the retail prices is to allow multibrand retail to enter the country.
Last year, commerce minister Anand Sharma met the media and some of his cabinet colleagues and impressed upon them the need to support opening up of multibrand retail. Why the urgency? Sharma had replied: ‘Policy formation is a dynamic process, and we are progressive and forward-looking.’ Read the whole article here.
Many mistakes have been made in the name of progress and modernity – and allowing in retail corporates would be one of the biggest. Unconvinced? Read about Britain’s experience in Andrew Simms’ book, Tescopoly:
“Bursting with stats and facts it documents the big four supermarket groups’ exploitation of the market for groceries, and the harm they do to their customers, suppliers and the environment by strangling competition and forcing food producers into impossible deals.
“More worryingly, though, it documents Tesco’s drive into ever more areas, wiping out whole high streets by providing everything from cabbages to cutlets, baps to bank accounts, and ready meals to medicine. Now, as it moves into providing phone services, broadband and even legal services, its power over our day to day lives gets ever stronger”