InvestorQ : What are the implications of the amendments to the Essential Commodities Act as approved by the Union Cabinet?
prachi Patwardhan made post

What are the implications of the amendments to the Essential Commodities Act as approved by the Union Cabinet?

Answer
user profile image
3 months ago


On 03 June, the 60 year old Essential Commodities Act (ECA) was finally amended by a Union Cabinet headed by the Prime Minister. This Act has been cited as one of the reasons for lack of investments in the farm sector as some of the conditions are too stringent. For example, it empowers government to impose curbs on stocking of farm produce. Such draconian sections will be amended. This will also mean that many essential commodities like cereals, edible oils, oilseeds, pulses, onions and potato may be deregulated. Henceforth, no stock limit will apply to processors following the latest amendment to the Essential Commodities Act. Such stock limits will only be valid in exceptional circumstances like national calamities or famine. It is more of shortage legislation and may not be relevant at a time when India produces sufficient quantities of these food grains. This move is expected to be the first step towards the one nation; one market arrangement.