India's wholesale prices fall for 17th straight month in March. Picture: A wholesale vegetable market in Chandigarh, India, 24 July, 2015.Reuters

A recent spike in onion prices is haunting the Bharatiya Janata Party (BJP)-led government yet again and a poor monsoon rainfall is expected to push onion prices further in the coming weeks.

The wholesale prices of onions rose by Rs 400 to touch a two-year high of Rs 4,900 per quintal on Thursday in India's largest onion market, Lasalgaon in Maharashtra. In Bengaluru, the wholesale prices have gone up to Rs 5,000 per quintal, IBN Live reported.

In Delhi, the retail prices have climbed to Rs 80/kg and the State government is supplying onions at a subsidised rate of Rs 30/kg. With the wholesale prices standing at Rs 50/kg, the retail prices may exceed Rs 70/kg in many parts of the country.

"Prices have today touched a two-year high at Lasalgaon mainly due to the decline in supplies as harvesting of onion has been delayed. Now it seems that there will also be a fall in the production of kharif onion," National Horticultural Research and Development Foundation (NHRDF) director R P Gupta told PTI.

Since the first week of August, Onion prices have been seeing a sharp rise in prices from Rs 20/kg due to deficient monsoon in major onion producing States such Maharashtra, Karnataka and Andhra Pradesh.

"There are chances of substantial decline in kharif onion production from Maharashtra, Karnataka and Andhra Pradesh due to deficient rainfall, while there is also a threat of drought in these States," said Gupta.

Concerned over the skyrocketing onion prices, the Central government has asked public sector trading body MMTC to import 10,000 metric tonnes of onions to contain the rising prices.

"Traders will participate in the MMTC tender if they have taken into consideration demands of traders. If good quality onion from Egypt comes, it will help to control prices," Danish Shah, a leading importer and exporter of onions from Maharashtra, told The Economic Times.

The price rise is also caused by a decline in supply due to delayed harvesting in Gujarat, Rajasthan and Madhya Pradesh (MP).

So far, the monsoon rainfall has been uneven across the country, with only a few regions receiving excess or normal rains while most of the regions witnessing a below-normal monsoon.

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