Prices of several essential products falling: government

July 1st, 2008 - 9:15 pm ICT by IANS  

New Delhi, July 1 (IANS) Despite 11.42 percent inflation, a 13-year high, prices of a number of essential articles showed a declining trend in the week ended June 14, the finance ministry said here Tuesday. “The government is taking measures to moderate the inflationary pressures,” the ministry said in a statement, without specifying the measures.

“Annual inflation of 30 essential commodities as on June 14, 2008 at 6.55 percent has also been relatively moderate. Among the 30 essential commodities, bajra, moong, urad, potatoes, onions and inland fish witnessed a decline in inflation,” the ministry said.

“Build-up of inflation for the 30 commodities comprising cereals, pulses, vegetables like onions and potatoes, milk, edible oils, sugar, tea, kerosene, etc., since Jan 5 2008 was 4.1 percent, which is less than half of the overall build up of inflation during this period,” the ministry has claimed.

“Year-on-year inflation measured in terms of the wholesale price index increased to 11.42 percent on June 14. Though highest in the last 13 years, inflation is largely commodity-centric,” the statement said.

The ministry said between Jan 5 and June 14 this year, the economy witnessed a build-up of inflation of 8.5 percentage points.

“Disaggregated commodity level details indicate that around 60 percent of the increase in the inflation in the primary articles was accounted for by five commodities - iron ore, cotton, milk, fish marine and oranges,” the ministry said.

“Almost the entire increase in fuel and power group of commodities was accounted for by petroleum products, covering a combination of products which are under administered prices and those which have a free pricing,” said the ministry.

“Even in the manufacturing sector, nearly 60 percent of the increase was accounted for by eight products, six of which belong to the category of iron and steel products.”

The statement said: “Taking Jan 5 2008 as the base, it is observed that 206 commodities in the commodity basket of wholesale price index (1993-94 series) with a combined weight of 34.3 percent witnessed either a price stability or a decline in prices.”

It added: “35 of these commodities belonged to primary articles category, 6 to the commodity group of fuel and power, and 165 commodities in the manufacturing products sub group.”

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