The two commodities were brought back under the Essential Commodities Act after a decade, which will allow the government to place the stock-holding limits for one year.
“The government received complaints that despite good stocks, hoarding is taking place. Moreover, six states also sought such as step. Now the states must take firm, effective and result-oriented steps to crack down on hoarding,” law minister Ravi Shankar Prasad said.
Wholesale prices hit a five-month high of 6.01% in May. Food prices have more than doubled, as a sluggish monsoon keeps government and farmers edgy.
The government raised the minimum price at which onions can be sold abroad to $500 a tonne (about Rs. 30,000).
Asked on how the govt planned to tackle concerns of a drought, Prasad said: “We expect good rains in the next few days.”