Cabinet likely to discuss extension of stock holding limit on food items today

The Essential Commodities Act will expire on 31 Nov

With food inflation showing little signs of abating, the Cabinet is likely to extend the power of state governments to impose stock holding limits on edible oil, oilseeds, rice and paddy beyond November 30.

The proposal will come up in the union Cabinet as it falls under the central law-- Essential Commodities Act.  

Officials in the know said that Act was to expire on November 31 and could have led to a tendency among traders to hoard these essential commodities. "Which is why it is being extended," he explained.

India's WPI food inflation for October stood at around 18.2%, while headline number was around 7%.

"The extension order basically empowers the state government to undertake de-hoarding activities and stop black-marketing," the official explained. Meanwhile, some officials in the know said the cabinet could also discuss mandatory jute packaging order for 2013 and amendments to a scheme on financial restructuring of state power distribution companies.