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The ministry of consumer affairs on Thursday flagged off the first onion express, carrying around 1,700 tonnes of the Indian kitchen staple from the buffer stock, as part of its efforts to rein in sky-high onion prices.
The consignment, dispatched from Nashik, is expected to arrive at Delhi’s Kishanganj railway station on 20 October. The onions will be sent to wholesale markets across the National Capital Region (NCR), said consumer affairs secretary Nidhi Khare.
“Additionally, onions will be transported through rail rakes to the northeastern regions as well as key cities in Uttar Pradesh, including Lucknow and Varanasi. This move is expected to help stabilize prices amid increased demand during the festive season,” Khare said.
“This move aims to reduce onion prices nationwide by making large quantities of onions available in the market. However, the initiative to sell onions at a discounted rate of ₹35/kg will continue,” she added.
Mint was the first to report this development on 27 September, detailing the plan.
Besides, Khare said tomato prices are expected to drop significantly in the coming week as stocks have started arriving from Maharashtra.
Annual retail inflation, based on the Consumer Price Index (CPI), rose to 5.49% in September from 3.65% in August. This is the highest retail inflation rate recorded since December 2023, when it was 5.69%.
However, it is still within the Reserve Bank of India’s (RBI) medium-term target of 2-6%.
Food inflation, on the other hand, rose 9.24% annually compared to a 5.66% rise in August. It stood at 5.42% in July, 9.36% in June, 8.69% in May and 8.70% in April, according to the ministry of statistics and programme implementation.
Cost-effective move
The department of consumer affairs, which has roped in the services of the railways for the first time as part of its market intervention strategy, will incur only half the cost compared to transporting onions from Nashik via trucks.
The secretary said transporting this quantity (about 1,700 tonnes) of onions by truck would cost the ministry around ₹70 lakh, while using a single rail rake costs ₹35 lakh. The onions being moved are equal to 53 truckloads, showing how rail transport is both more efficient and cost-effective.
The ministry is releasing onions from its buffer stock of 470,000 tonnes, with 91,960 tonnes already released into the open market to stabilize prices.
In the northeastern regions, onions will be transported by rail to locations such as Siliguri, Dibrugarh, Tinsukia, and Changsari.
The ministry has tasked the National Agricultural Cooperative Marketing Federation of India Ltd (NAFED) to offload onions in bulk at the wholesale markets of Chennai and Mumbai to help reduce prices.
The ministry has also partnered with e-commerce platforms Otipy and Zepto to sell discounted onions. Among retail stores, Reliance Retail, which operates over 4,000 outlets, is also being engaged in the initiative.
The ministry has allocated 15,000 tonnes of onions each to Bihar and Uttar Pradesh, and 10,000 tonnes each to Maharashtra, Karnataka, Gujarat, and Rajasthan. Smaller allocations have been made to Goa (7,500 tonnes), Nagaland (5,000 tonnes), and Manipur (4,000 tonnes).
As of 16 October, the onion price in Delhi stood at ₹60 per kilogramme, reflecting a 50% increase from last year’s price of ₹40/kg.
In Mumbai, the price surged to ₹75/kg, marking an increase of 114.29% from ₹35/kg last year. In Chennai, onions are priced at ₹60/kg, about 57.89% higher than last year’s ₹38/kg.
In Ranchi, the price of onions has reached ₹58/kg, indicating a rise of around 65.71% from last year’s ₹35/kg.
Due to rising vegetable prices, the cost of a home-cooked vegetarian thali surged 11% year-on-year in September, according to the ratings agency Crisil.
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