MP Officials Rigged Bids To Sell Onions At Rs 2.10 Per Kg To Private Traders

An investigation by India Today has revealed massive corruption in state-run auctions of onions by Madhya Pradesh public distribution system – selling truckloads of the vegetable to private traders at shockingly low prices.

A part of the staple Indian diet, onions have scarred several governments in the past as well.

India Today probe exposed how the Madhya Pradesh’s food supply chain was involved in what appears to be a systematic loot of the vegetable from government purchase yards.

In 2016-17, the state produced 32 lakh metric tons of onions, reported the network. Last month, MP farmers began a protest against the plummeting prices of their bumper crop. The agitation killed five farmers, giving more spark to the protests. In an attempt to calm the situation, Chief Minister Shivraj Singh Chouhan announced that the government would buy onions at Rs 8 per kg.

Operation Onion

Ideally, the farmers’ onion produce should have auctioned off to traders at the highest possible rates. However, an investigation by India Today revealed a different picture – bureaucrats in command were found to be staging the bidding process by giving the first-hand advantage to a select few merchants in exchange for hefty bribes.

The epicentre of the scam was the state capital, Bhopal. At the city’s Prayavas Bhawan, India Today’s undercover reporter walked into the headquarters of state’s civil supplies department, the Madhya Pradesh State Civil Supplies Corporation Ltd (MPSCSC). The general manager, Srikant Soni, agreed to undersell huge quantities of onions for colossal bribes.

In the video uploaded by India Today, Soni can be heard saying, “Bidding will be managed. That’s what I am saying. I can manage it at Shajapur, Maksi and Shujalpur (mandis).”

#OperationFarmgate2.0
Top officials caught rigging onion auctions in Madhya Pradesh.#NewsToday @sardesairajdeep​: https://t.co/YCxwjCGK27 pic.twitter.com/eotDdr2tZz

— India Today (@IndiaToday) July 19, 2017

He pledged that the final bid would not exceed 10 paisas over the floor price of Rs 2 a kilo.

“I’ll fix it at Rs 2.10. Let’s see how easily it can be managed at Rs 2.10,” Soni said.

He first demanded a bribe of Rs 3-4 lakh, however, later raised it to Rs 5 lakh to manipulate the auction and ‘fix’ local officials on the ground.

“I have to share something with them (mandi officials). I’ll talk to them how it can be managed,” he said. “I’ll get it done in 5 (lakh rupees).”

The racket involved putting up dummy traders as bidders across different mandis. They were not supposed to bid over pre-set prices or reject the produce by claiming the produce to be of bad quality. They were told to fail competitive sale. Authentic big wholesalers were kept back from the auction venues.

At Ujjain’s large Chiman Ganj Mandi, nodal officer Om Prakash Singh was seen brokering deals as a middleman for traders looking for onions cheap at twice the price.

“I’ll get it (the auction fixed) at Rs 2.15,” he promised. “It’s my job to ensure that you don’t pay anyone else.”

India Today’s undercover reporter was then taken by Singh to a local warehouse.

“There was a lot of business last year. We spiked the figure of actual damage in records by two to five percent,” he revealed. “All of that was auctioned off between Rs 2 and Rs 2.50. The prices came down later to Rs 1.5 to Re 1.”

Multi-layered scam

The corruption scandal enveloped large parts of Madhya Pradesh.

At the Shajapur mandi, India Today’s undercover journalist met its secretary Virendra Arya in his office. Arya proudly publicised the scam, calling in a merchant to participate in a potential bidding. The trader, Navrattan Jain, struck the deal at a pre-set price of Rs 250 per quintal. He fixed his commission at Rs 2.50 a kilo.

When probed about his cut, Arya wrote Rs 5 on the palm of India Today’s reporter. “It’s Rs 5 a quintal not per sack,” he explained.

The Logical Indian take

After the sting was aired, the Madhya Pradesh government came into action and suspended Srikant Soni, general manager of Madhya Pradesh State Civil Supplies Corporation Limited (MPSCSC), reported India Today.

Last month, in addition to five farmers losing their lives during protests for fair price and loan waivers in Madhya Pradesh, five others also committed suicide. In a fortnight, 27 farmers had committed suicide in the state.

The reason? Unending financial burden.

Kedar Sirohi, the founder of Aam Kisan Union (AKU), who has been fighting to uplift the condition of Madhya Pradesh farmers for years, revealed that for 2000 kgs of potatoes, farmers got only Re 1 in March this year.

Despite the pitiful state of farmers in Madhya Pradesh, the state’s public distribution system continued to exploit them. Only last month, hundreds of farmers held protests asking for fair prices, but bureaucrats still sold their produce for low costs and hefty bribes.

The Logical Indian community strongly condemns the blatant disregard shown by MP public distribution authorities. Instead of coming to the aid of farmers who are giving up their lives and being forced to sell their produce at abnormally low rates, the bureaucrats are filing their own pockets. India Today’s investigation has revealed an important issue that needs our immediate attention. We commend the network’s work in this regard and hope and such cases are prevented in future.

You read India Today’s whole operation here.