The Essential Commodities Act, 1955 allows the government to control the production, supply and distribution of some commodities for maintaining or increasing supplies and securing their equitable distribution. The aim of this Act is to ensure easy availability of important commodities to consumers and check exploitation by traders.
The Essential Commodities Act, 1955 was introduced sixty five years back, as India during those times was facing severe food shortage and had to import different agricultural produce from various countries. In an aim to stop stockpiling and black marketing of commodities, this Act was brought into force.
The Union Cabinet approved amendment to the sixty five year old Essential Commodities Act to deregulate certain food items mentioned below.
When a commodity is classified as essential, the government has complete control over its Production, Supply and Distribution. As a result of the amendment, the Government will no more regulate these commodities.
The Amendment made to this Act will lead to elimination of the following from the list of essential commodities:
- Edible Oils
This will remove fears of private investors of excessive regulatory interferencePrakash Javadekar, Union Minister
The government also approved “The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020” to empower farmers to engage with processors, aggregators, wholesalers, large retailers and exporters. In addition, the Cabinet approved “The Farming Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020 to create an ecosystem where farmers and traders can freely sell and purchase the agricultural produce.
This is a historic-step in unlocking the vastly regulated agricultural markets in the countryNarendra Tomar, Agriculture Minister
These proposals were part of the Rs 20 lakh crore economic package announced to help those affected due to the COVID-19 lockdown.