PM reviews price rise situation

PM reviews price rise situation

The meeting attended by by Finance Minister Pranab Mukherjee, Home Minister P Chidambaram, Food and Agriculture Minister Sharad Pawar and Planning Commission Deputy Chairman Montek Singh Ahluwalia remained inconclusive.

"Another round of discussion may be held tomorrow," a source said.
Food inflation rose to 18.32 per cent for the week ended December 25, due to rise in prices of food items like onion, milk and meat.
Retail price of onion continues to rule high at Rs 55-60 per kg in major parts of the country due to sluggish supply.

Food inflation has been fuelled by high prices of vegetables, fruits,meat, eggs and milk.
Onion has remained in headlines since prices could decline only marginally despite the government announcing three weeks ago that it was taking several measures to increase supply, including through import.

However, Pawar said yesterday that there was not much the government could do in regard to vegetable prices.
"...vegetable prices are high and on that we do not have any control," he said, hoping that prices would come down "eventually".

Even arrivals of new onion crop could not make much impact on its prices which remained at Rs 55-60 at the retail level.

Measures like Income Tax raids on traders, slashing import duty on onion and tight monetary policy by the Reserve Bank have not helped ease the situation. To some extent, global spike in commodity prices are also being blamed for inflation, which has become a main concern for the government.

On the import front, there seems to be no immediate hopes of Pakistan resuming onion exports to India with its local traders deciding to sell the contracted 3,000 tonnes of the vegetable into their local market.

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