Govt pledges steps to tame rising prices

Finance Minister Mukherjee rules out a single index for measuring inflation

Pranab Mukherjee

“We will take appropriate action comprising necessary policy initiatives to keep the prices of essential commodities under control,” Finance Minister Pranab Mukherjee told the Rajya Sabha while making an intervention during discussion on rise in prices of essential commodities.

Asserting that the government is “responsive” to suffering of people arising out of rise in prices of basic food items he said the policy measures would focus on both supply management and demand management of essential commodities.

Ironically, while inflation measured by the Wholesale Price Index (WPI) remained in the negative territory for the eighth consecutive week ended July 25 to minus 1.58 per cent, essential commodities particularly food items like sugar and pulses are witnessing a sharp rise in prices in the recent weeks. While responding to members’ observation that inflation measured by WPI is not reflecting the real situation on price front, Mukherjee informed the house that the government had constituted a high level committee to examine the scope for evolving a comprehensive and single Consumer Price Index (CPI) to measure price rise. “Considering the diversity of economic condition in various parts of the country as well as wide variations in the income group we have four categories of CPI to measure inflation. Attempts are being made to evolve a single CPI, which can reflect the realistic picture on price front,” he said. “While attempts will be made to remove distortions in the different series of consumer prices indices, the WPI will continue,” he said. He said in country of India’s size and dimension it was not possible to have a single index for measuring inflation.

Pawar paints grim picture
Meanwhile, painting a grim picture on overall price situation of essential commodities, the government on Thursday said various steps, including easy imports of pulses and sugar, have been taken to protect vulnerable sections.

“Overall price situation is very serious. But government has taken various steps (to ease the situation),” Food and Agriculture Minister Sharad Pawar said replying to a discussion in Rajya Sabha on rising prices of essential commodities.

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