The Standing Committee on Food, Consumer Affairs and Public Distribution has asked the government to implement in “letter and spirit” the Essential Commodities (Amendment) Act, 2020, one of the three farm laws against which the farmers are protesting at the borders of Delhi for the last 116 days.

What is the law?

The Essential Commodities (Amendment) Act, 2020 is one of the three contentious farm laws. It was enacted on September 26, 2020 by amending the Essential Commodities Act, 1955. Under the amended law, the supply of certain foodstuffs — including cereals, pulses, oilseeds, edible oils, potato — can be regulated only under extraordinary circumstances, which include an extraordinary price rise, war, famine, and natural calamity of a severe nature. In effect, the amendment takes these items out from the purview of Section 3(1), which gave powers to the central government to “control production, supply, distribution, etc., of essential commodities.”

Through the Essential Commodities Act, 2020, the government has inserted sub-section I(A) in the Section 3 of the Essential Commodities Act, 1955. The new sub-section states, “the supply of such foodstuffs, including cereals, pulses, potato, onion, edible oilseeds and oils, as the Central Government may, by notification in the Official Gazette, specify, may be regulated only under extraordinary circumstances which may include war, famine, extraordinary price rise and natural calamity of grave nature…”

The new law also specifies conditions when the stock limits can be imposed.

The Parliamentary Standing Committee on Food, Consumer Affairs and Public Distribution, headed by TMC member Sudip Bandyopadhyay, has recommended to the government to implement, “in letter and spirit,” the Essential Commodities (Amendment) Act, 2020. In its report on ‘Price Rise of Essential Commodities- Causes and Effects,’ the committee has given reasons for the implementation of the law.

“The Committee note that although the country has become surplus in most agricultural commodities, farmers have been unable to get better prices due to lack of investment in cold storage, warehouses, processing and export as entrepreneurs stated to be get discouraged by the regulatory mechanisms in the Essential Commodities Act, 1955,” says the report of the committee.

How is an ‘essential commodity’ defined?

There is no specific definition of essential commodities in The Essential Commodities Act, 1955. Section 2(A) states that an “essential commodity” means a commodity specified in the Schedule of the Act. The Act gives powers to the central government to add or remove a commodity in the Schedule. The Centre, if it is satisfied that it is necessary to do so in public interest, can notify an item as essential, in consultation with state governments. According to the Ministry of Consumer Affairs, Food and Public Distribution, which implements the Act, the Schedule at present contains seven commodities — drugs; fertilisers, whether inorganic, organic or mixed; foodstuffs including edible oils; hank yarn made wholly from cotton; petroleum and petroleum products; raw jute and jute textiles; seeds of food-crops and seeds of fruits and vegetables, seeds of cattle fodder, jute seed, cotton seed.