A retrograde move

When the move to amend the Essential Commodities (EC) Act, 1955, was initiated, there was hope that it would lead to further liberalisation of the restrictive provisions of the original statute. But the amendment Bill that the government has got approved by the Rajya Sabha seeks to achieve something else. It actually makes it easier for the government to declare any commodity an essential item merely through a notification. The provision that the validity of such notifications will be limited to six months is no comfort because an extension of this period is also permitted in public interest or on account of scarcity of the commodity in question. Of course, the Bill also seeks, for the right reasons, to further prune the current list of essential items. But here also it does not go far enough. Many of the commodities that have still been retained in this list should not be there by any logic. How, for instance, can jute and jute textiles be deemed essential items?

Indeed, what needs to be realised is that the EC Act may have been the call of the hour when it was enacted in 1955 but it has since lost its relevance. In fact, in today's context, such a measure needs to be viewed as wholly retrograde. For, the basic tenet of the EC Act""to control production, supply, trade and commerce of goods""is incompatible with the spirit of economic liberalisation. On the contrary, what is vitally needed is the removal of all unnecessary and redundant controls to permit the operation of market forces. Indeed, the standing committee of some Union ministers and chief ministers belonging to various political parties that reviewed the EC Act in 2001 had recommended a progressive dismantling of such controls. The move by the previous NDA government in 2002 to delete several categories of products from the essential items list and nullify a large number of control orders issued under this law was based on the wider political consensus that had been arrived at in this standing committee. The present UPA government, too, had been talking about further dilution of this law till it was suddenly accosted by the demand from chief ministers of Congress-ruled states for more powers to tackle the menace of rising prices. What perhaps skipped the attention of these chief ministers was the existence in the statute book of an even more draconian law""the Prevention of Black-marketing and Maintenance of Supply of Essential Commodities Act, 1980. This law empowers the state governments to detain any person on charges of unethical trade practices. Such legal measures, besides being oppressive, leave ample scope for harassment and extortion. Of course, unfair trade practices cannot, in any way, be disregarded but statutory measures, unfriendly to trade, are also equally untenable. It would, therefore, be worthwhile to revisit, if not rescind, this dated law to make it more relevant.