Why in News ?
Lok Sabha passed the Essential Commodities (Amendment) Bill, 2020 which seeks to deregulate food items, including cereals, pulses and onion, a move aimed at transforming the farm sector and raising farmers’ income.
What The Essential Commodities (Amendment) Bill, 2020 says ?
- This Bill replaces the Essential Commodities (Amendment) Ordinance, 2020 and amends the Essential Commodities Act, 1955.
- Allows the central government to regulate the supply of certain food items only under extraordinary circumstances.
- Stock limits may be imposed on agricultural produce only if there is a steep price rise.
- Removes cereal, pulses, oilseed, edible oil, onion and potatoes from the list of essential commodities.
- Food items Regulation :
- The central government may regulate or prohibit the production, supply, distribution, trade, and commerce of such essential commodities.
- Food items including cereals, pulses, potatoes, onions, edible oilseeds, and oils, only under extraordinary circumstances.
- The extra ordinary situation mentioned as
- War
- Famine
- Extraordinary price rise
- Natural calamity of grave nature.
- Stock limit :
- Imposition of any stock limit on agricultural produce must be based on price rise.
- The limit is imposed only if
- 100% increase in retail price of horticultural produce.
- 100% increase in the retail price of non-perishable agricultural food items.
- Price fixing : Calculated over the price prevailing immediately preceding twelve months or the average retail price of the last five years, whichever is lower.
Need for the Bill
- Bill aims to remove fears among private investors of excessive regulatory interference in their business operations.
- The freedom to produce, hold, move, distribute and supply will attract private sector/foreign direct investment into the agriculture sector
- It will help drive up investment in cold storage and modernisation of the food supply chain.
- The amendment helps to prevent wastage of agricultural produce due to lack of storage facilities
- While liberalising the regulatory environment, has also ensured that interests of consumers are safeguarded.
- In situations such as war, famine, extraordinary price rise and natural calamity, such agricultural foodstuff can be regulated.
Source : Economic Times
Topic
GS II : Government policies and interventions for development in various sectors and issues arising out of their design and implementation.
GS III : Issues related to direct and indirect farm subsidies and minimum support prices; Public Distribution System- objectives, functioning, limitations, revamping; issues of buffer stocks and food security; Technology missions; economics of animal-rearing
Current Affairs Compilation : 16 September 2020