UPA steps to curb price rise failed, will NDA's succeed?

NEW DELHI: The slew of measures announced by the Modi government to fight rising prices have raised the question: Since all this has been done before, will it work? During UPA 2, minister for consumer affairs K V Thomas told the Lok Sabha 11 different times that state governments had been told to seriously tackle inflation by acting against hoarders and black marketeers. This is what was repeated in Friday's meeting of state food ministers where finance minister Arun Jaitley urged the states to tackle "hoarding, cartelization and artificial storages". To be fair, Jaitley declared that the central government would be working in close coordination with the state governments, thus lending a certain heft to the plan. But is that enough? To be true, the NDA government has also brought potatoes and onions in the essential commodities list, as well as moved to make hoarding a non-bailable offence. This may discourage hoarding, but the record of the state governments in tackling hoarders and black marketeers in the past few years is dismal. And the Modi government is dealing with the very same state governments as did UPA 2. From data supplied by state governments to the consumer affairs ministry, and from answers to Parliament queries, it turns out that between 2008 and 2013, a total of 26,472 persons were prosecuted under the Essential Commodities Act, the Prevention of Black-marketing and Maintenance of Supplies of Essential Commodities Act and rules flowing from it. This was after nearly 11 lakh raids were carried out and nearly Rs 1,200 crore worth of commodities were confiscated. But the most worrisome part is: Only 2,484 people were actually convicted. That's a conviction rate of less than 10%. It's unlikely to deter hoarders and black marketeers, especially if they are the big fish. "Regulatory chaos has prevailed in the states," explained a senior state government official in the food and civil supplies department, who spoke on condition of anonymity. In the UPA reign, a series of orders were passed dismantling or restricting the rules on how much stocks could be kept and other aspects. Even the judiciary struck down actions taken on various technical grounds, the official said. "But the main thing was that officials were hesitant to act because no political will was there," he said. The data on raids and prosecution gives a glimpse of the chaos. Several states have not been submitting any information at all — like Madhya Pradesh has not submitted any report after 2008, Jharkhand and Uttarakhand have not reported from even before and many other states have given patchy reports, omitting some months here and there. Will all this sound and fury in Delhi force the state governments to act tough on hoarders? Experts are skeptical, going by past record. P G Chengappa, former vice-chancellor of the University of Agricultural Sciences, Bangalore says that the experience of declaring "essential commodity" and managing "stock" has met with little success. "It is ideal to improve the marketing efficiency by strict enforcement of trading practices and break the cartel by allowing more commission agents," he told TOI. AV Manjunath of the Institute for Social and Economic Change, Bangalore, who was one of the co-authors of a 2012 report on onion markets in India brought out by the Competition Commission, said that to improve market efficiency market infrastructure and allowing new commission agents are necessary. "Strong Institutions are essential to penalize those who are involved in speculative hoarding and cartelization," he told TOI. TOI