Price index of eight food items on decline

July 10th, 2008 - 7:57 pm ICT by IANS  

New Delhi, July 10 (IANS) Eight commodities that account for 40 percent of the food basket in wholesale price index (WPI) have recorded average decline of 1.2 percent in their prices over the past two months, a study by an industry lobby released Thursday said. “The food articles, which have witnessed decline in prices between mid-April and mid-June, are fruits, pulses, sweet potato, potatoes, onions, bajra, sugar and wheat,” according to the Associated Chambers of Commerce and Industry of India (Assocham) study.

The cumulative weightage of these commodities is 40 percent in food articles and seven percent in the complete wholesale price index. In the last one month, the prices of these commodities have declined 1.7 percent.

“Decline in the prices of food items is a healthy trend,” said Assocham president Sajjan Jindal. “It signifies that various measures taken by the government to tame food inflation are working.”

The analysis is based on the difference in the value of WPI index 14 June and 12 April for calculating rise or decline in prices over two months.

To track a four-week change, the May 10 index value is considered.

The price index of many broader categories of food items has also reduced in over the past eight weeks. This includes food grains (down 0.09 percent), and fruits and vegetables (down 3.02 percent).

Besides, there are certain food commodities to have recorded decline in prices even on year-on-year basis.

The collective wholesale prices of 13 essential food commodities including onions, potatoes, vegetables, inland fish, pulses, sugarcane and bajra registered a significant decline of 13.43 percent between July 2007 and June 2008.

“Various steps taken by the government like banning exports (of) and scrapping import duties on cooking oils and maize, cutting excise and customs duties, streamlining the public distribution system and setting limits on food prices has caused the price decline”, the study said.

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