Cabinet nod for amendment to Essential Commodities Act, 2 ordinances to promote barrier-free trade

The Union Cabinet on Wednesday approved amendment to the six-a-and-half decade old Essential Commodities Act to deregulate food items, including cereals, pulses and onion, a move that will transform the farm sector and help raise farmers' income.

The Cabinet also approved 'The Farming Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020' to ensure barrier free trade in agriculture produce.

The government also approved 'The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020' to empower farmers to engage with processors, aggregators, wholesalers, large retailers and exporters.


Announcing the Cabinet decisions, Agriculture Minister Narendra Singh Tomar said, "This will go a long way in helping India's farmers while also transforming the agriculture sector."

The proposed amendment to the Essential Commodities Act will allay fears of private investors of excessive regulatory interference, he said.

Tomar said that 'The Farming Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020' will promote barrier-free inter-state and intra-state trade and commerce outside the physical premises of markets notified under State Agricultural Produce Marketing legislations.

"This is a historic-step in unlocking the vastly regulated agricultural markets in the country," he said.

Tomar said that the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020' will empower farmers for engaging with processors, aggregators, large retailers, exporters etc., on a level playing field without any fear of exploitation.

These proposals were part of the Rs 20 lakh crore economic package announced to help those affected due to the lockdown clamped to fight the spread of COVID-19 disease.