Union minister for finance Arun Jaitley with Union minister for consumer affairs, food and public distribution, Ram Vilas Paswan during the State Food Ministers' Conference in New Delhi on Friday. Telegraph picture

New Delhi, July 4: The Centre will make hoarding a non-bailable offence, set a price stabilisation fund and fix a cap on the quantity of essential commodities that can be stocked.

The decision comes a day after Bihar rejected the Centre’s plea to cap the quantity of essential commodities like onions and potatoes that can be stocked. It’s plea was that it was for the Centre to come up with such a law. The Centre has now decided to work closely with states in this regard.

State food and consumer protection minister Shyam Rajak told The Telegraph over phone from New Delhi: “All food ministers today sat with Union minister of consumer affairs, food and public distribution Ram Vilas Paswan in New Delhi and discussed ways by which prices of essential commodities can be controlled. Bihar put forth its point and the Centre agreed to our point. It has been decided that the Essential Commodities Act will be strengthened and made stringent. Also, the Centre has said they will fix the cap on stocking of essential commodities. Thus, state governments will not be involved in fixing the stock limit.”

“There was a consensus that the Essential Commodities Act should be strengthened and more teeth provided to it. Offences under the law should be made non-bailable,” Paswan said after the meeting.

He said a proposal to make necessary amendments in the Essential Commodities Act would be moved for the Cabinet’s consideration in a week. He did not indicate the size of the fund being created or the timeframe within which it will be set up.

Union finance minister Arun Jaitley stressed there was no panic situation. Hoarders were disrupting normal supply anticipating high prices, he said.

“We have sufficient foodgrain with the Government of India to face to any kind of situation. Depending on where the shortfall or deficient areas are... if such a situation arises, we are equipped to deal with it,” he said.

Stating that food prices rise during monsoon months of July-September, Paswan said it was decided that at least one storage space would be created in all 635 districts.

Rajak confirmed the Centre has decided to help state governments in construction of cold storages and normal storages in every district. “The issue of absence of proper storage in many districts was raised and the Centre agreed it needed to the addressed. The Centre will come up with storages of different kinds in every district of states. And again, the state government will help the Centre in this connection. It has also been decided that the Centre will create a price control fund in association with state governments. Details of how the fund will function will be discussed. However, it will be exclusively for controlling prices of commodities,” Rajak said.

Earlier, there was a division of opinion among economists on the Centre’s decision. While some said the Centre should decide on the quantity that can be stocked, others felt the state government was in a better position to do the same.

The consumers said there was need for transparency. “The state government should provide the right information to the Centre and the Centre too should check and re-check facts and figures being given by the Centre before implementing the stock limits. If this is not done, things will never improve,” Kankerbagh resident Surendra Kumar said.