Wheat, pulses hoarding busters get 6 more mths
Centre on Thursday extended up to February 2008 notifications that empower state governments to impose restrictions on wheat and pulses stocks and control their physical movement.
By TNN |
NEW DELHI: In a bid to reinforce the drive against hoarding and check spiralling domestic prices of essential commodities, the Centre on Thursday extended up to February 2008 notifications that empower state governments to impose restrictions on wheat and pulses stocks and control their physical movement. The notifications are related with removal of controls imposed under the Essential Commodities Act, 1955.
The move acquires significance in view of the festival season which begins in September and extends up to the end of the year. It was at this time last year that domestic prices of essential commodities shot through the roof and spiked inflation, forcing the government to take a plethora of steps to control retail prices.
Given that, the decision signals the Centre’s apprehensions on the possibility of a repeat scenario this year, all the more so in view of its inability to import 5 million tonnes of wheat, mainly as an insurance against a hike in inflation and to reinforce its buffer stocks until April 2008.
"The Union Cabinet today extended the validity of the central notifications dated August 29, 2006 and February 27, 2007 for another six months from September 1, 2007 to February 29, 2008," information and broadcasting minister P R Dasmunsi told reporters after a Cabinet meeting.
The decision would also empower state governments to conduct extensive raids and anti-hoarding operations against suspected hoarders of the two commodities. Sources said several state governments had been requesting for this extension in view of price apprehensions during the festival season. Last year, several states and union territories, including Delhi, Maharashtra, W Bengal and Kerala, had used the provisions to regulate or bar physical movement of the commodities and to conduct raids.
In 2006, the government had faced a major challenge in keeping a check on prices of agricultural commodities against low domestic supply and hardening international prices. Consequently, it took a series of measures and contained price rise. It also banned sugar exports in an attempt to control sugar price hike.
The major measures taken to check price rise included import of 55 lakh tonnes wheat by the State Trading Corporation, import of 49,300 tonnes of pulses by Nafed, allowing import of wheat, pulses and sugar at zero duty, ban on export of pulses and sugar, reduction in duty on palm oil by 10% and the issuance of a Central Order on August 29 empowering state governments to issue control order in respect of purchase, movement, sale, supply, distribution or storage for wheat and pulses.
To contain volatility in the futures prices of wheat, sugar and pulses, the Forward Markets Commission (FMC) also took a series of regulatory measures such as imposition of limits on open position, reduction in limits on daily price fluctuations and imposition of additional/special margins. State governments also instructed traders to declare any procurement of wheat above 50,000 tonnes.
The move acquires significance in view of the festival season which begins in September and extends up to the end of the year. It was at this time last year that domestic prices of essential commodities shot through the roof and spiked inflation, forcing the government to take a plethora of steps to control retail prices.
Given that, the decision signals the Centre’s apprehensions on the possibility of a repeat scenario this year, all the more so in view of its inability to import 5 million tonnes of wheat, mainly as an insurance against a hike in inflation and to reinforce its buffer stocks until April 2008.
"The Union Cabinet today extended the validity of the central notifications dated August 29, 2006 and February 27, 2007 for another six months from September 1, 2007 to February 29, 2008," information and broadcasting minister P R Dasmunsi told reporters after a Cabinet meeting.
The decision would also empower state governments to conduct extensive raids and anti-hoarding operations against suspected hoarders of the two commodities. Sources said several state governments had been requesting for this extension in view of price apprehensions during the festival season. Last year, several states and union territories, including Delhi, Maharashtra, W Bengal and Kerala, had used the provisions to regulate or bar physical movement of the commodities and to conduct raids.
In 2006, the government had faced a major challenge in keeping a check on prices of agricultural commodities against low domestic supply and hardening international prices. Consequently, it took a series of measures and contained price rise. It also banned sugar exports in an attempt to control sugar price hike.
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The major measures taken to check price rise included import of 55 lakh tonnes wheat by the State Trading Corporation, import of 49,300 tonnes of pulses by Nafed, allowing import of wheat, pulses and sugar at zero duty, ban on export of pulses and sugar, reduction in duty on palm oil by 10% and the issuance of a Central Order on August 29 empowering state governments to issue control order in respect of purchase, movement, sale, supply, distribution or storage for wheat and pulses.
To contain volatility in the futures prices of wheat, sugar and pulses, the Forward Markets Commission (FMC) also took a series of regulatory measures such as imposition of limits on open position, reduction in limits on daily price fluctuations and imposition of additional/special margins. State governments also instructed traders to declare any procurement of wheat above 50,000 tonnes.
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