A 2006 amendment to the Standards of Weights and Measures (Packaged Commodities) Rules omitted the mandatory requirement for manufacturers of packaged consumer goods to maintain standard weights.
The decision, a DNA investigation found, was pushed through without discussion or consultation with consumer rights group.
What’s worse, the amendment was introduced on a trial basis. It was decided that the ministry would study the impact of the change on consumers and roll back the decision in case it had an adverse effect.
However, for six years, the ministry has not conducted a study on the impact and the amendment remains in force.
“It was agreed to go ahead with the amendment only as a temporary measure to understand its benefits to the Indian consumer,” said Bejon Mishra, who represented the Consumer Coordination Council (CCC), a consumer rights organisation. A top management employee with a leading fast-moving consumer goods (FMCG) company who was part of the amendment process seconded Mishra’s views.
However, DS Chadha, who represented the Confederation of Indian Industry (CII) on behalf of FMCG companies, said there was no such declaration while amending the rule.
Over the past three years, the amendment has allowed FMCG companies to make a killing by reducing the packaged weight of a product, but keeping its price unchanged.
Documents with DNA and interviews show that FMCG companies influenced the government to amend the SWMPC Rules, 1977. The rules provided for standard weights for consumer goods. Amendment of rule 5 allowed manufacturers to pack products in various non-standard weights. The minutes of meetings held to discuss the changes suggest that the amendment was carried out without much discussion.
“This (lobbying) has been going on since I joined the consumer movement in India in 1983. I presume it must have been there even before that,” said Mishra, who attended the meetings to discuss the amendment to the SWMPC rules.
The government defended itself saying all stakeholders were involved in the process. However, those who represent consumer interests say they were unaware of the amendment and failed to recall attending such meetings even though their names feature on the list of attendees.
“I do not remember attending a meeting to discuss non-standard weights,” said Shri Ram Khanna, who is said to have represented VOICE, a New Delhi-based consumer rights organisation. “This amendment came as a complete surprise.”
“The secretary also said that the third schedule to the rules providing for standard sizes is not entirely based on metric system and it is high time that the same is done away with to let the consumer decide what he wants,” according to the minutes of a meetings held in Delhi on April 6, 2005. Besides this, there is no mention of the rule anywhere. Another meeting was held in Mumbai on May 28, 2006.
“There was no reference to rule 5 in the file given to me by the consumer ministry under the RTI Act,” said CJ Karira, an RTI activist from Hyderabad, who has been pursuing the matter since the amendment came into force. He was allowed to inspect the file in December 2008, six months after he filed the RTI query.
In response to another RTI query, the ministry said four to five seminars were held to discuss the amendment, but no information on the details of the conclaves were provided.
“The amendment balances the interest of the consumer and industries… it allows industries to adopt new pack sizes as per consumer demand,” the RTI reply said. “Why is there no explanation given about the kind of research done by the industries or the department of consumer affairs to justify consumer demand in response to my RTI query?” asks Karira.
Managing director of Gujarat Co-operative Milk Marketing Federation Limited (Amul) RS Sodhi said millions of customers have been cheated because of the amendment as the sizes of packs they buy have been reduced. “We received several complaints about FMCG companies hiking product prices directly even though there is no increase in the cost of raw material. They also take indirect hikes by reducing the weight (in terms of grams) of the product,” said BN Dixit, legal metrology, ministry of consumer affairs, adding that the rule was amended as per the recommendation of a committee set up by the ministry.
Last October, the government decided to roll back the amendment about reintroducing standard pack sizes for products of everyday household consumption. The rule will come into force from July 1, 2012.
Food products will now have to be packaged in standard sizes
KOLKATA, NOV. 1:
From Thursday, all manufacturing units of 19 specified commodities are to conform to new standard packaging and declaration norms.
The Union Government under the Legal Metrology (packaged commodities) Amendment Rules 2012 has made it mandatory for a manufacturer to pack items in prescribed standard sizes only. The step had been taken to ensure price and quantity comparability of the products at the retail end, according to Government sources.
Products such as biscuits, baby food, bread, butter, coffee, tea, drinking water, milk powder, soft drink, weaning food, salt, edible oils, cereals, pulses, rice, wheat flour, cement and paints have come under the new rule.
According to industry sources, manufacturers in the organised sector have taken appropriate actions to comply with the standard size and labelling norm.
FMCG companies said that they began the preparatory work for compliance four months ago. The Government had extended the deadline for compliance from July 1 to November 1.
Chitranjan Dar, Divisional Chief Executive, ITC's foods division, told Business Line, “We started the exercise a few months ago. One or two items which did not have standard quantities are also standardised as prescribed by the law.”
According to him, there was no need to tamper with the price of the products because of the new rule, “as there were variances of only two or three grams here and there”.
“Comparability is the main issue that has been stressed through these new norms. Manufacturers have been reducing quantity keeping the price unchanged,” said Edelweiss analyst Abneesh Roy.
According to the sources in the Union Ministry of Consumer Affairs, Food and Public Distribution, the practice of non-standard pack, seen in recent months, have to be discontinued forthwith.
“Manufacturers cannot deviate from the prescribed standard size,” said a senior ministry official.
Under the new rules, the manufacturers no longer can use rubber stamp to declare month and year of manufacture and have to use standard value of weight, volume or number or length, breadth and thickness only.
Use of words like large, medium, XXL and L in garments to denote size are not allowed. It has to be in centimetres. Ice creams and similar frozen products should be sold by weight only.
Consumer goods companies have been reducing pack sizes while keeping prices constant. There were also instances of offering “extra” quantity at the same price. Under this new norm all these practices will have to stop, industry insiders said. The rules have exempted lower unit price packs worth Re 1 to Rs 10.
Companies have to now compulsorily mention significant details on promotional offer packages and relaxations in weight for categories of bread, biscuits, baby food, beverages, edible oil, toilet soaps and packaged water.
According to Roy, many of the FMCG items are now available in less than Rs 10 packs.
“Our estimates suggest that around 75 per cent of the shampoo packs are sold in less than Rs 10 format,” Roy said.