Government worried about inflation, says it is imported

April 11th, 2008 - 6:30 pm ICT by admin  

New Delhi, April 11 (IANS) The current bout of inflation was imported from the global market, and more corrective measures would follow to contain prices of essential goods, union minister Kapil Sibal said here Friday. “The government is exceptionally concerned about inflation. Measures like import duty cut on edible oils and banning the export of rice and pulses have been taken, and more measures will follow if needed,” Sibal told reporters after a cabinet meeting.

The cabinet, however, did not discuss inflation, which rose further to hit a 41-month high of 7.41 percent for the week that ended March 29.

“The meeting did not discuss inflation,” admitted Sibal, who holds science and technology and earth sciences portfolios.

“The current bout of inflation is not because of any default in our policy. It is a global phenomenon, and we have imported inflation. It will take some time when the prices of essential goods moderate,” he said.

Reeling out comparative figures, Sibal said inflation in China was 8.7 percent, while in Russia, Argentina, and Turkey had 11.9, 7.3 and 8.1 percent respectively.

“As per a World Bank report, there was an increase of 105 percent in the prices of grains between 2007 and March 2008, while the prices of coconut oil, rice, and sugar recorded 61, 72 and 35 percent increase during the same period.”

The inflation rate, based on the official wholesale price index, is the highest since Nov 8, 2004, as per data released Friday by the commerce and industry ministry.

Sibal, however, claimed that the government measures had soothing impact on the prices of edible oil. “We have heard that the prices of edible oil have started showing a downward trend.”

The minister said the state governments, irrespective of their political affiliations, should take action against hoarders and impose the stock limit norms strictly.

“Inflation should be the concern of every government. The state government must initiate action against hoarders,” Sibal said.

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