CCI orders probe into high onion prices

The Competition Commission of India (CCI), the country’s apex fair trade watchdog, has instituted an inquiry into the rising prices of onions.

This is the first instance where the commission, which turned fully operational less than two years ago, has stepped in to probe pricing pattern of an agricultural produce for possible cartelisation.

The commission has the powers to investigate the current practices within the entire supply chain – both private and public – before coming out with its conclusions.

The CCI move has come at a time when India is reeling under food inflation, led by high onion prices. This has compelled the central government to ask the state governments to manage supply chains efficiently to rein in high prices of vegetables, including onions.

In a meeting today, CCI is known to have found a prima facie case against onion trade, thereby hinting at the possibility of the existence of cartels at various levels across the nation that are creating an artificial price increase and shortage for onions.

The commission has asked its investigation wing, headed by the Director General, to look into the matter and submit the report, sources say.

CCI officials refused to comment.
The Competition Act defines cartel as an association of producers, sellers, distributors, traders of service providers who by agreement amongst themselves, limit, control or attempt to control the production, distribution, sale or price of or trade in goods or provision of services.

The Director General (Investigations) can submit its report within six months, though it has completed several investigations in a much shorter period on a priority basis.