Tamil Nadu Foodgrains Merchants Association has said that the Food Safety and Standards (FSS) Act 2006, being implemented since August 5, will hurt small and medium enterprises (SMEs). While welcoming the provisions to promote consumer welfare and safety, association vice president P. Subash Chandra Bose said that the Act's stringent penalties for violating the provisions threaten the survival of small industries.
The association also demanded that two-thirds of the members of the Food Safety Standards Authority must comprise food processors, traders and farmers and the Centre must modify the Act after consulting them.
A lack of adequate laboratory infrastructure, high charges for testing of samples and absence of other facilities across the country and the huge cost of adopting technology to meet the exacting standards demanded by the act would threaten the financial viability of SMEs by driving up operational expenses.
The Act was drafted by associations of multinational companies and designed to benefit only big companies by driving small operators out of business over a period of time.
Many clauses in the Act were impractical and penalties stipulated for violations were steep and stringent, he said pointing to the example of mandating that all food products' packets must have nutritional values of all ingredients in the product.
Most SMEs were not in a position to brand every product strictly according to rules and regulations of the FSSA. Agricultural conditions varied across different regions and the food industry cannot bring about the uniformity demanded by the Act.
While wilful adulteration must be resisted, honest operators should not be punished with penalties ranging up to Rs. 10 lakh and even imprisonment in certain clauses.
In the earlier legislation, the PFA Act, maximum penalty itself was Rs. 20,000.
