The Chief Economic Advisor to the Finance Ministry, Kaushik Basu today said he favours some decontrolling of fuel prices. Talking to reporters in New Delh, he said, this may marginally increase inflation in the short run but will help to control it in the long run as it will improve further the fiscal health of the economy. Replying to a question on the implementation of Kirith Parikh Committee report, he explained that steps can be taken to restrict the impact of inflation among vulnerable sections of society. Mr Basu added while food inflation is coming down , manufactured items like iron and steel are witnessing price inflation. He explained that food inflation may look high in May, as inflation is calculated on a yearly basis, but the food price index is only slightly higher than what it was in November, 2009. Mr Basu refused to hazard a guess on what the Reserve Bank will do in terms of its monetary policy, to be unveiled on July 27. He projected that the economy would grow by 8.9 per cent in the first quarter of this fiscal.He said the economic growth is better than expected with robust fiscal situation and excelenet performance of the manufacturing sector. Mr Basu said that FDI has also picked up but agriculture contniues to be cause of worry.