Examine the effectiveness of buffer stock operations under the Price Stabilisation Fund in balancing consumer affordability and farmer remuneration, with reference to onion price management.

The Price Stabilisation Fund (PSF), created in 2014-15, finances procurement of a buffer in price-volatile agri-horticultural commodities — onion, potato and pulses — to moderate extreme price swings [1]. In onion, it has cushioned both ends of the market, yet its balancing role remains largely reactive rather than structural.

Gains on consumer affordability

• Scale of the buffer has expanded sharply, from 1 LMT in 2020-21 to 7 LMT in 2023-24, enabling calibrated lean-season releases into deficit markets [2].
• Targeted retail disposal: mobile vans of NCCF, NAFED and Kendriya Bhandar sold onion at Rs 35/kg [3] and subsequently Rs 24/kg [4] during retail spikes, blunting CPI-food pressure.
• Trade-policy backstop: even after the export prohibition was lifted on 4 May 2024, a 40% export duty and MEP of USD 550/MT were retained to protect domestic availability [5].

Gains on farmer remuneration

• Assured floor through direct purchase: NCCF and NAFED were directed to procure 5 lakh tonnes from the Rabi-2024 crop directly from farmers [6], absorbing surplus at harvest peak.
• Buffer offtake reduces distress sales in the Nashik–Maharashtra belt, where perishability weakens farmers' holding power.
• Export normalisation restored demand — 2.60 lakh tonnes exported in 2024-25 up to 31 July 2024 [5] — and the residual 20% duty was withdrawn from 1 April 2025 [7].

Where the balance falters

• A consumer-ward tilt: bans and MEPs cap farmer realisation at the price peak, while buffer releases cannot lift prices during a glut.
• Policy unpredictability — duty, then MEP, then ban, then relaxation within months [5] — discourages exporters and rational acreage planning.
• Storage losses, thin coverage relative to total marketed surplus, and dependence on a few cooperative agencies limit last-mile reach.

Buffer operations have therefore delivered credible short-run price containment without achieving durable stabilisation. Shifting to rule-based trigger prices, investment in irradiation and cold-chain storage, and convergence with Operation Greens would make the twin objectives complementary rather than competing — advancing both food-price stability and SDG-2 goals of farmer income security.