The mid-year review of the economy has called for urgent action to contain the rising prices of food articles hitting the common man hard. The review tabled in Parliament on Friday described the trend as a cause of concern. Recent data released by the government showed food inflation was nearly 20 per cent, the highest in a decade. The review said that the dominant cause for high inflation is apprehension of reduction in food production over the next month due to drought and poor rains in different parts of the country. Increased purchasing power and the poverty alleviation programme have also raised the demand for various goods.The review said that while the government can augment supply through imports, this option may not be available for commodities like pulses, which are available only in limited quantity in the international market. The review pointed out that the inflation is looking larger than what it is because of the base effect.Earlier the Standing Committee on Finance had pulled up the Finance Ministry for its failure to take timely action to tame inflation and asked the government to take immediate steps to provide relief to the common man. It also suggested amending the Essential Commodities Act to check hoarding and speculation. The Finance Minister Pranab Mukherjee has said the government will import essential commodities to improve supplies.
News On AIR | December 19, 2009 9:34 PM
Mid-year economic review calls for urgent action to check soaring food prices