"The NGOs are free to be watchdogs, but they must realise that their reports and findings should not be targeted only at the industry... While the government is trying to move towards ease of doing business by relaxing the inspector raj, the NGO policing may harm many times," it said.
Drawing a parallel to the Maggi controversy, the chamber suggested that India should not be left to "scare-mongering by NGOs".
According to a report by the Centre for Science and Environment (CSE), nearly 84 per cent of 38 commonly available brands of pre-packaged breads, including pav and buns, tested positive for potassium bromate and potassium iodate, banned in many countries as they are listed as "hazardous" for public health.
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"If at all there is a problem, it does not lie at the door of the industry, which only would be put to immense loss of consumer confidence and crores of rupees worth of loss. Already, reports suggest a sharp fall in the sale of morning breads and a sense of panic among the homemakers," Rawat added.
The use of potassium bromate, purported to be harmful to health, was done with the permission and full knowledge of the food regulator, the lobby group said.
Rawat felt that the Health Ministry and regulator FSSAI should immediately come out with a clarification on the bread controversy. "If needed, the manufacturers should also engage with the regulator and consumers, giving them confidence," he added.
"As it is, the stock prices of the food companies have come under pressure out of panic."
In its report, CSE claimed that while one of the chemicals is a category 2B carcinogen (possibly carcinogenic to humans), the other could trigger thyroid disorders, but India has not banned the use.