New Delhi: The Essential Commodities Act, 1955, which provides for control of production, supply and distribution, is to be amended to remove all restrictions in tune with the changed situation.

In the context of liberalisation and the changed situation, particularly a relatively comfortable food situation, it has been felt that licensing of dealers, limits on stocks and control on movements will only hamper the growth of the agricultural sector and promotion of food processing industries, says an official release.

A standing committee of Union Ministers and some Chief Ministers suggested that the Act continue as umbrella legislation for the Centre and the States to use when needed, but a progressive dismantling of controls and restrictions was also required.

It is now universally accepted that all unnecessary and redundant restrictions, which distort and impede the operation of market forces should be removed.

Common Indian market

In the case of agricultural commodities, such restrictions/regulations have adversely affected the interests of farmers without any benefit flowing to consumers. Moreover, the goal of a common Indian market, particularly for agricultural commodities, and promotion of agro-exports and agro processing industries will be difficult to achieve unless trade and commerce is freed from such discretionary restrictions.

Accordingly, the Cabinet approved the proposal of the Department of Consumer Affairs for introduction of the Essential Commodities (Amendment) Bill, 2005 seeking Parliament's approval to retain control only over drugs; foodstuffs including edible oilseeds and oils; fertilizer, whether inorganic, organic or mixed; petroleum and petroleum products; hank yarn made wholly from cotton; raw jute and jute textile; seeds of food crops, seeds of fruits and vegetables, seeds of cattle fodder, and jute seeds.

This Bill was introduced in the Rajya Sabha on December 20.

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