Govt. taking all steps to check price rise: Mukherjee

BHUBANESWAR - Union Finance Minister Pranab Mukherjee on Sunday asserted that the Central Government is taking all necessary steps to check the price rise of essential commodities, and added that measures, both on supply and demand side, are being taken and imports of essential food items on short supply with zero duty are being allowed to improve the situation.

Mukherjee, however, said India can’t insulate itself from the price rise effect as many global factors like hike in crude oil prices, especially those of diesel are affecting it.

Expressing deep concern over rising food prices, Mukherjee told reporters here: “Letters have been written to all the chief ministers to act according to the essential commodities act and prevent hoarding of essential commodities.”

“The poor people are being given food commodities on subsidised rates,” he added.

Earlier on Friday, amid pressure over rising food prices, Mukherjee asked State Chief Ministers to crack down on hoarders to ensure smooth supply of essential items from farm gate to retail customers.

In a letter, Mukherjee urged them to ensure that all bottlenecks in the supply chain are removed at the earliest.

Mukherjee said the availability of the items that are driving the current round of food inflation in the economy should be improved so that food prices can be brought down quickly.

“A larger part of price rise is due to the widening gap between the wholesale and retail prices and the growing demand for these products due to rising income levels,” he said.

Mukherjee asked the state Chief Ministers to urgently look into the supply management of items that are driving the current round of food inflation in the economy, in particular the local factors that are widening the gap between the wholesale and retail prices.

The Finance Minister said much of the food inflation has been due to significant increase in the prices of a few primary items (those found in the raw form) like fruits and vegetables, milk, meat, poultry, eggs and fish.

He also mentioned in his letter that the inflation data shows that three-fourth of food inflation is due to rising prices of vegetables.

Earlier on Thursday, Mukherjee said that food inflation, which stood at 18.32 per cent for the week ending December 25, 2010, remained an area of concern.

“It has moved further. It is an area of concern,” said Mukherjee after the government’s weekly data showed that food inflation kept climbing for the fifth straight week.

The weekly inflation figure is the highest during the past one year.

Food inflation shot up to nearly a year’s high of 18.32 per cent on December 25, due to spurt in vegetables, onion and milk prices.

The wholesale food inflation jumped by 3.88 percentage points from 14.44 per cent recorded in the week ending December 18, 2010.

Mukherjee, however, said these were weekly variations and figure for the month of December was yet to come before a final assessment could be made.

“These are weekly (figures). Let us wait for monthly figures. These are weekly variations, but is a matter of concern,” he added.

Mukherjee had earlier said that the year-end inflation might be around 6.5 percent even after the recent fluctuation in the prices of various commodities. (ANI)