Chidambaram blames states for price rise

April 16th, 2008 - 10:31 pm ICT by admin  

A file-photo of P. Chidambaram

New Delhi, April 16 (IANS) As prices of food grains and other essential commodities continued to soar, the government Wednesday blamed the states for the crisis and asked them to rein in hoarders and black marketeers. Intervening in a discussion on the price rise in the Lok Sabha, Finance Minister P. Chidambaram said the states must reinforce the stock limit norms to deal with the situation and initiate action against the hoarders.

“The state governments must reinforce the stock limit norms, and prosecute hoarders and black marketers. The central government will not hesitate from taking tough administrative measures,” Chidamabaram told the house amid disruptions from the opposition members.

He regretted that the states were not taking “adequate measures” to force the traders to comply with the stock limit norms under the Essential Commodities Act, 1955.

Under the Act, the states are empowered to restrict the quantum of essential food grains like wheat, rice, pulses and edible oils that a trader can stock.

In Delhi, for instance, there is a stock limit of 1,000 quintals for wheat.

“The state governments are not taking adequate action,” Chidamabaram told the Lok Sabha.

Chidambaram had told reporters after a Cabinet Committee on Prices (CCP) meeting March 31 that few states were imposing the stock limit norms.

“Only five or six states have exercised the power given to them. There is a large onus on the state governments to exercise the power they wanted. It is largely unexercised and we will want the states to act,” Chidambaram had then said.

Since the budget session of parliament was reconvened Tuesday, the United Progressive Alliance (UPA) government has been under fire in both houses from the main opposition Bharatiya Janata Party (BJP) as well as its own allies, particularly the Left parties.

Agriculture and Consumer Affairs Minister Sharad Pawar in his reply to the discussion in the Lok Sabha said the government was making all possible efforts to check inflation, and the prices of rice, wheat and other essential commodities were already moderating.

“In countries like Vietnam, Thailand and Pakistan, there is an increase of over 100 percent in the prices of rice and wheat, while in India the prices of rice and wheat have increased by 17.2 percent and 7.2 percent respectively,” Pawar said.

Earlier in the debate, the UPA’s allies refused to buy the government’s argument that it was doing everything possible to control inflation and the price rise.

“The Manmohan Singh government must justify its existence. It seems there is no government in place. Things have been left to market forces. The government is out of place,” said Communist Party of India (CPI) MP Gurudas Dasgupta.

“The government is not worried about the poor at all,” said Sumitra Mahajan of the Bharatiya Janata Party (BJP), while Devendra Prasad Yadav of the Rashtriya Janata Dal (RJD) said the government must ban the futures trading.

In the Rajya Sabha, Communist Party of India-Marxist (CPI-M) MP, Sitaram Yechury asked the government to take immediate steps to strengthen the public distribution system (PDS).

The only voices in defence of the government came from the treasury benches.

Sachin Pilot, Congress MP in Lok Sabha, recounted several measures the government had taken to reduce inflation. But he ended up, like the Left parties, calling for a ban on the futures trading in essential commodities.

Mohan Singh of the Samajwadi Party held the Left parties equally responsible for the price situation. “Had the Left parties been serious about the issue as in the case of the (India-US) nuclear deal, the situation would have been entirely different.”

Like the Congress, other UPA constituents are nervous about the impact inflation may have on their poll prospects in the 2009 general elections.

India’s inflation rate reached 7.41 percent in the week ending March 29, a three-year high.

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