Area
India
Commodity Group
Rice
Commodity
All
Date
05/06/2020
Policy Category
Stocks
Policy Instrument
Stock limits
Description
Approved the Essential Commodities (Amendment) Ordinance, 2020, amending the 1955 Essential Commodity Act, with immediate effect. Under the Ordinance, the supply of foodstuffs, including cereals, pulses, potato, onions, edible oilseeds and oils, may be regulated through stockholding limits by the central Government only under extraordinary circumstances, including war, famine, extraordinary price rise and grave natural calamities. Moreover, the imposition of stock limits based on price increases would only be permitted when retailed prices rose, relative to levels registered in the preceding 12 months or 5-year average (whichever is lower), by 100 percent in the case of horticultural products and by 50 percent for non-perishable foods. Processors, exporters and other value chain actors will, however, be exempt from stockholding limits, provided that imposed stock limits do not exceed their overall ceiling of processing capacity, or demand for export, in the case of exporters. The ordinance was replaced by the Essential Commodities (Amendment) Act, 2020, issued on 27 September 2020, which contained similar provisions, with effect from 5 June 2020.
