Key Differences between PFA, 1954 and FSSA, 2006.

 

Key Differences between PFA, 1954 and FSSA, 2006.

 

Friends, as we know the Food Safety and Standard Act, 2006 is a pivotal act to maintain and regulate food safety throughout the country. The act is mandatory and actually replaces the Prevention of Food Adulteration Act, 1954.

With the emergence of the FSSA, 2006 there is a single reference point of control related to all matters of food. Due to certain drawbacks the PFA, 1954 repealed to FSSA, 2006. As, we know the Food Safety and Standard Act, 2006 is a combination of eight (08) different act or orders in which the PFA is a major contributing one.

1.   Prevention of Food Adulteration (PFA), 1954

2.   Fruit Product Order (FPO), 1955

3.   Meat and Food Product Order (MFPO), 1973

4.   Milk and Milk Product Order (MMPO), 1992

5.   Vegetable Oil Products (Control) Order, 1947

6.   Edible Oils Packaging (Regulation) Order, 1998

7.   Solvent Extracted Oil, De-oiled Meal, and Edible Flour (Control) Order, 1967

8.   Any other order under Essential Commodities Act, 1955 relating to food.

Main Features of the Food Safety and Standard Act, 2006:

Following are some of the key main features of FSSA, 2006.

1.   Movement from multilevel and multi-departmental control to an integrated line of command.

2.   Single reference point for all matters related to food safety and standards.

3.   To provide self-monitoring Food Safety Management Systems.

4.   Promote general awareness about food safety and standards.

5.   Provision of offences depending upon offences and accordingly.

6.   Framing of regulations, standards and guidelines related to articles of food.

7.   Responsibility of food business operator (FBO) to ensure food safety.

Key Distinguishing Differences between PFA, 1954 and FSSA, 2006:

With concern to the key understanding here, I am trying to represent both important Acts with certain set of parameters to make the distinguishing features of the Prevention of Food Adulteration (PFA), 1954 and The Food Safety and Standard Act (FSSA), 2006. To regulate the Food Safety Act, the Food Safety Standard Authority of India (FSSAI) came in to effect.

These are described to know the key difference among both the Act. It is an important aspect for FSSAI mains and numerous examinations of Central FSO (Food Safety Officer), TO (Technical Officer) and Assistant Commissioners.  Here, is the list of key differences for the same concern.

No.	Parameter	PFA, 1954	FSSA, 2006
1.	Name	Prevention of Food Adulteration, 1954 (37 of 1954)	The Food Safety Standard Act, 2006 (34 of 2006)
2.	Goal	To find out Adulteration	Food Safety
3.	Focus	Inspection and Control	Monitoring Surveillance and Close observation
4.	Authority	Multiple Authorities	Single Authority
5.	Workforce	Insufficient Enforcement Personnel	Full-Time Officer like FSO (Food Safety Officer)
6.	Responsibility	Food Inspector is responsible for Examination & Execution.	Responsibility of food safety is on FBO (Food Business Operator)
7.	Improvement Notice	No provision for Improvement Notice	Provision for Improvement Notice
8.	Penalty Provision	Direct Prosecution by Court	Through the Adjudication process (section 68 of FSSA, 2006) provision of penalty for offences made.
9.	Court Appeal	No Appeal before moving to court.	Food Safety Tribunal Provision (Section 70 of FSSA, 2006).
10.	GMP or GHP Provision	GMP or GHP are non- mandatory in nature.	GMP or GHP is mandatory according to Schedule 4 of FSSA.
11.	Import	Improper control on Import	Proper Import control and structure
12.	Sampling	Under Section number 4 of PFA, 1954 food inspector collects Three (03) samples	Under section number 38 of FSSA, 2006 FSO (Food Safety Officer) collects Four (04) samples.
13.	Personnel in Sampling	Food Inspector collects the sample from any manufactures and sent it to Public analyst for analysis and subsequent proceedings.	Food Safety Officer (FSO) collects the sample from any FBO and sent it to Food analyst for analysis and subsequent proceedings.
14.	Food Recall Procedure	No separate provisions for food recall procedure.	Separate provision made for Food recall procedure. (Article of food which is marketed and initiate the process to recall it due to not fit for consumption).
15.	Administrative Control	PFA dealt with many government Ministries and handling different food orders like FPO, MMPO is sometimes inconsistent.	Administrative control of FSSA assigned to MoH&FW (Ministry of Health and Family Welfare) and establish a single reference point for all matters.
16.	Current Status	Not Effective in the current scenario.	Effective in the current scenario. Different eight act or orders are repealed by FSSA, 2006. (As specified above in the blog.)

 

Reference Video:  To understand the concept in a better manner uses the YouTube video link provided below.

https://www.youtube.com/channel/UCDul7uf7pcbM_kWCEaA9WvA

 

Elasticity of Demand | Price Elasticity of Demand

Price Elasticity of Demand

Demand is defined as a schedule that shows the amounts of a product or service the consumers are willing and able to purchase at each price during specific time and specific market.

According to Bowden, “Demand is the propensity of the consumers to buy different quantities of a particular good at different unit prices”.

Here, desire and ability to buy are the key components of demand whereas time and market are two requisites. In this article we are trying to take a look about Elasticity of demand, Types of Price elasticity of demand and certain importance for the same.

ELASTICITY OF DEMAND:

“Elasticity of demand is a tool that measures the responsiveness of the quantity demanded of a good to its price”.                                                                                   OR

“Elasticity of demand is the relative change in quantity demanded to the relative change in the price”.

Types of Elasticity of Demand:

1.    Price Elasticity of Demand

2.    Cross-Price Elasticity of Demand

3.    Income Elasticity of Demand

1.   Price Elasticity of Demand: It shows the responsiveness of quantity demanded to change in price with others factors being constant (i.e. Ceteris- paribus). Ceteris Paribus is a Latin term which means that Except Demand and price all other things like Income, Trends, Population, Scarcity, Season etc. will remain the same.

2.   Income Elasticity of Demand: It shows the responsiveness of quantity demanded to change in consumer income (%), with others factors being constant (i.e. Ceteris- paribus includes price of commodity, price of substitutes, tastes, preferences etc.)

·         Income Elasticity is equal to unity or one when the proportion of income spent on a good remains the same even though income has increased (E_I=1).

3.   Cross Elasticity of Demand: It shows the change in demand for one commodity due to change in price of other related commodity.

These may act as substitutes or complements; when fall in the price of one good increases demand for another good and vice versa.  Cross elasticity of demand can be used to indicate boundaries within industries. The cross elasticity of complementary goods is positive and that between substitutes, it is negative.

DEGREES OF PRICE ELASTICITY OF DEMAND:

In general sense, increase in price brings about a decrease in demand but this is not same in all goods. X axis represents Quantity of product whereas Y axis represents Price of the product. Elasticity of demand differs with different commodities. From the same commodity elasticity of demand differs from person to person.

Based on the magnitude of elasticity of demand it is further divided into five categories.

1.    Perfectly Inelastic Demand

2.    Perfectly Elastic Demand

3.    Relative Elastic Demand

4.    Relative Inelastic Demand

5.    Unitary Elastic Demand.

1. Perfectly Inelastic Demand: Here it is stated that, ‘No Matter what the price of the good is the demand will be the same’. The price of commodity may increase or decrease, the quantity demanded remains the same. Hence elasticity of demand is zero.

There is no change with concern to quantity demanded with respect to increase in price. Hence it is known as perfectly elastic in nature.

Ex.: Salt, water and Life saving drugs.

Therefore, Ed=0.

2. Perfectly Elastic Demand:  Here, a fractional change in the price may bring about huge change in the Quantity of demand’. Here, the demand is hypersensitive and the elasticity of demand is infinite. Demand curve is horizontal line and parallel to X-axis.

This concept is typically theoretical one and can be applied in only some of the competitive market. Here, the product is homogeneous in nature. It clearly depicts that a slight change in price would stop the demand.

Ed =Infinity

Ex.: Bread, Tea, Wada pav.

3. Relative Elastic Demand: ‘Small change in price of the commodity makes drastic change in quantity demanded’.

A small proportionate fall in price is accompanied by a larger proportionate increase in demand and vice versa. Hence Elasticity of demand is greater than unity. It is somewhat more practical application for different products.

Here Ed >1

Ex.: Vaccination, Mode of travel, Medicines etc.

4. Relative Inelastic Demand: ‘Phenomenal change in price will not make change in demand’. A large proportionate fall in price is followed by a smaller proportionate increase in the quantity demanded and vice versa.

Hence elasticity of demand is less than unity. Here Ed <1.  

Ex.: Niche market, Jewelry, Luxurious goods.  

5. Unitary Elastic Demand:   ‘Here, the Percent change in quantity demand on price will be proportional if price increases’. It means a given proportionate fall in price is followed by the same proportionate increase in demand and vice versa.

Change in demand and change in price of the product remains same. Hence Elasticity of demand is one.

Here Ed =1.

All the types of Elasticity are represented in the following Figure. The graph shows demand curve where, X axis is quantity demanded and Y axis shows prices. Following is the indication of the all types of elasticity’s.

·         DD₁: Perfectly Elastic Demand

·         DD₂: Elastic Demand

·         DD₃: Unitary Elastic Demand

·         DD₄: Inelastic Demand

·         DD₅: Perfectly Inelastic Demand

IMPORTANCE OF ELASTICITY OF DEMAND:

The importance of elasticity of demand is categorized into two bases i.e. practical and theoretical one.

Practical Importance of Elasticity of Demand:

1.   Taxation:

2.   Determination of wages

3.   International Trade

4.   Monopoly Price

5.   Increasing Returns

6.   Poverty in Plenty

7.   Elasticity of Promotional Activity

8.   Effect on the Economy

Theoretical Importance of Elasticity of Demand:

1.   Price Determination

2.   Price Discrimination

3.   Measuring degree of Monopoly Power

4.    Boundary between Industries

5.    Market Reforms

6.   Theory of Distribution

7.   Classification of goods as Substitutes and Complements:

Substitute – ‘A good that can be used in place of another good’.

Complement – ‘A good that is used in conjunction with another good’.

Reference Video:

Link: 

https://www.youtube.com/channel/UCDul7uf7pcbM_kWCEaA9WvA