INTRODUCTION
India is one of the largest producers of onion in the world second only to China, accounting for
16 percent of world area and 10 percent of production. In India, it is grown on 0.39 million
hectares with production of 4.30 million tonnes of bulbs per annum (FAO,1995). The current
year's production is estimated at 4.7 million tonnes. It is one of the most important vegetable
crops of our country and forms a part of daily diet in almost all house holds.
Most of the farmers bring onion directly to the market after harvest as proper storage facilities
are not available with them. The present storage capacities are quite inadequate and most of the
available units are traditional and unscientific. Fearing losses, farmers usually unload their
entire stock within a month of harvest. As a result, during this period prices rule very low due to
glut situation. Thereafter, the rise in prices is quite rapid and sometimes wide fluctuations occur
leading to dissatisfaction amongst the producers as well as consumers. To improve the situation,
GOI desired to create appropriate storage structures for onion, both at farm level as well as at
market places. It drew a capital subsidy programme for the infrastructure development in which
a pivotal role has been assigned to NABARD for its successful implementation. It has been
planned to create a storage capacity of 4.5 lakh tonnes of onion during 1999-2000 and 2000-
2001 through capital investment subsidy programme. Subsidy to the extent of 25% of the
investment cost subject to a maximum of Rs. 500 per tonne has been proposed to be routed
through NABARD for the credit delivery system.
