'Supply constraint responsible for hike in food prices'

“Primarily there has been constraint in supply of certain commodities. This constraint is not just in India but has been seen globally and is reflected in the price rise of the commodities,” Cabinet Secretary KM Chandrasekhar told reporters here, adding that the inflation stands just over 1 per cent. 

A few food items, especially vegetables, have seen notable increase in price. Within a month, the cost of onions has shot up by 30 per cent, while potatoes saw an increase of 11 per cent.
Even as inflation spiralled from a mere 0.50 per cent in September to 1.54 per cent in October, the overall food prices dropped by 1 per cent and vegetable prices declined by 16 per cent.

Chandrasekhar acknowledges that inflation needs to be watched. However, he was confident that prices of the food items would drop back to normal levels once the supply constraint eases.

Speaking on the sidelines of a CII seminar, Chandrasekhar said steps have been taken to augment supply of food products and procurement is going well.
“Import duties have been removed on most of these goods, free import has been allowed, procurement is going well; last year it was fine, and this year it looks even better,” Chandrasekhar added.

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