New Delhi: The inter-ministerial group on inflation is likely to review the APMC Act so as to prevent cartelisation by traders and allowing free movement of essential commodities.

"We have to review the Agriculture Produce Marketing Committee (APMC) Act so that mandis are not held by a cartel," said a source.

APMC Act provides for regulation of agricultural produce markets for providing an efficient system of buying and selling of agricultural commodities.

The attention would be paid to marketing of products, especially agriculture and food products, which would help in reducing the gap between what the farmers are getting and  consumers are paying.

The overall inflation increased marginally in February to 8.31 per cent from 8.23 per cent a month ago. Last week, the Reserve Bank in its quarterly monetary policy raised short-term lending and borrowing rates by 25 basis points each in a bid to contain inflation.

Further, the official said that space should be created for small traders to freely bring their products from farm to retail outlets, adding "We have to use our competition law very carefully and allow small traders to bring in their products."