Essential Commodities (Amendment) Ordinance issued; regulations on foodstuff supply eased

President Ram Nath Kovind on Friday, June 5 promulgated 'The Essential Commodities (Amendment) Ordinance, 2020'. This comes two days after the Union Cabinet approved the amendment to the Essential Commodities Act, 1955 so that the farmers can get a good price on many commodities. The ordinance specifies that the supply of foodstuffs including cereals, pulses, potato, edible oilseeds, and oils shall be regulated only under exceptional circumstances such as war, famine, extraordinary price rise, and natural calamity of a grave nature.

Moreover, the stock limit of any agricultural produce can be regulated only under specific conditions. An order in this regard can be passed if there is a 100% increase in the retail price of horticulture produce/ 50% increase in the retail price of non-perishable agricultural foodstuffs over the price prevailing immediately preceding 12 months or average retail price of last 5 years, whichever is lower. Such an order will not apply to a value chain participant of any agricultural produce if the stock limit of such person does not exceed the overall ceiling of the installed capacity of processing.

At the same time, the ordinance states that the amended provisions will not be applicable to any order regarding the Public Distribution System or the Targeted Public Distribution System. 

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Read: Amendment Of Essential Commodities Act Will Bring Relief For Farmers: Kailash Chaudhary

'Dangling sword of the Essential Commodities Act halted investment' 

Addressing a press briefing on Wednesday, Union Union Information and Broadcasting Minister Prakash Javadekar elaborated on the decisions taken by the Union Cabinet pertaining to agriculture and other sectors. He contended that some provisions of the Essential Commodities Act, 1955 not only imposed restrictions on the farmers but also halted investment in the agriculture sector. Furthermore, he mentioned that the Union government would introduce another ordinance to free the farmers from the constraints of the Agriculture Produce Market Committee whereby they would be able to sell their produce anywhere. 

Prakash Javadekar remarked, "Historic decisions have been taken regarding agriculture. Today, the 50-year-old demands of the farmers are getting fulfilled. Reforms have been done in the Essential Commodities Act, 1955. There are some provisions of the law which impose restrictions on the farmers when the prices increase. The dangling sword of the Essential Commodities Act halted investment. Neither did the storage increase nor did investment come. Due to the amendment, the farmers will get a good price. Items such as food grains, oil, dal, pulses, potato have been removed from the purview of this Act."  

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