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The recent Onion crisis is the result of market inefficiencies, weak supply chains and monopolies in the market. Analyse and suggest solutions to the above problem.

Topic:  Food processing and related industries in India- scope’ and significance, location, upstream and downstream requirements, supply chain management. Land reforms in India.

5. The recent Onion crisis is the result of market inefficiencies, weak supply chains and monopolies in the market. Analyse and suggest solutions to the above problem. (250 words)

Business Standard 

Why this question:

The question is in the current context of fluctuating onion prices in the economy.

Key demand of the question:

Discuss in detail the underlying causes of such price fluctuations owing to market inefficiencies, weak supply chains and monopolies in the market.

Directive:

Analyze – When asked to analyse, you have to examine methodically the structure or nature of the topic by separating it into component parts and present them as a whole in a summary.

Structure of the answer:

Introduction:

The onion – ubiquitous in Indian cooking – is widely seen as the poor man’s vegetable.

Body:

Discuss the causes of such fluctuation – like a drop in supply, due to heavy rains and flooding destroying the crop in large parts of India etc. are common that reason out to contribute to the price instability. Discuss the concerns associated with market inefficiencies, weak supply chains and monopolies in the market.

Explain what needs to be done? Suggest solutions such as – grass-root planning and better storage facilities and food processing services will ease the problem – and making a variety of cash crops and vegetables available across the country would also ease the pressure on onions.

Conclusion:

Conclude with way forward.