Hoarding of essential food items to be made non-bailable

As part of a six-month plan to curb food inflation, hoarding of essential commodities such as onion, potato, rice, wheat and pulses will become a non-bailable offence.

The plan will be finalised and circulated within a week.

The plan, which includes the setting up of a Price Stabilisation Fund, was agreed upon at a meeting between the Centre and State Food Ministers, convened in the wake of a spurt in food prices.

Chairing the day-long meeting, attended by food ministers from 25 States, Finance Minister Arun Jaitley said there was no reason to panic due to deficient rainfall in the country. Since, the meeting recognised hoarding and not scarcity as the reason for the price rise, the focus is to curb it, he said.

Giving details of the action plan, Food and Consumer Affairs Minister Ram Vilas Paswan said there was a need to give more teeth to the Essential Commodities Act.

He said the Act would be amended and made more stringent by making offences non-bailable. Currently, hoarding is one of the most common offences under the Act and punishable with a fine or imprisonment (between three months to seven years), or both.

On the Price Stabilisation Fund, officials explained that in the case of a price rise, State Governments will procure costly essential items — vegetables and perishables — and sell them to the public at lower prices. The difference between the cost and selling price would be met through the fund, they said.

Without giving out the likely corpus, the officials said this is different from food subsidy and should be considered a market intervention mechanism.

The process to set up the fund, which was also mentioned in the BJP manifesto, will begin soon.

The food ministers accepted that onion will constitute a major challenge since five States — Maharashtra (28 per cent), Madhya Pradesh (16), Karnataka (14), Andhra Pradesh (9), and Bihar (7) — account for three-fourths of the total production.

“The onion wholesale market is controlled by a cartel of 12-15 wholesalers across the country. Free inter-State movement, de-hoarding operations and decentralised stocking of onion to meet dispersed demand across the country will be ensured,” the plan document said. Earlier, when asked specifically about measures to mitigate drought in the wake of a fresh estimate of poor rainfall, the Finance Minister said: “The monsoon has just started, though the start is late. I think it is too early to panic.”

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