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PM chairs price rise meet, Core group suggests use of technology to tame prices
Published on 9 Apr. 2010 12:13 AM IST
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Prime Minister Manmohan Singh, his senior cabinet colleagues and chief ministers of 10 states began their deliberations on containing price rise here Thursday amid fears of inflation crossing the double digit mark.
The meeting is being held even as the Left parties went ahead with their nationwide agitation during which they courted arrest to protest rising prices.
The core group of chief ministers, set up in February, comprises Andhra Pradesh, Assam, Bihar, West Bengal, Punjab, Gujarat, Haryana, Tamil Nadu, Madhya Pradesh and Chhattisgarh.
Finance Minister Pranab Mukherjee, Food and Agriculture Minister Sharad Pawar and Planning Commission Deputy Chairman Montek Singh Ahluwalia are also attending the meeting.
Inflation soared to 9.89 percent during February and is feared to cross the double-digit mark in March - the data for which is likely to be released next week. Food inflation has been ruling at over 16 percent.
The prime minister on the eve of the significant meeting had said: “The country has a problem and I would like all political parties to pool their knowledge, wisdom and experience to evolve practical, pragmatic solutions to these problems.
Core group suggests
A meeting on rising prices chaired by Prime Minister Manmohan Singh Thursday recommended the use of technology and global positioning system to track vehicles carrying essential commodities for better management of the public distribution system (PDS).
The over four-hour long meeting held at the Prime Minister’s House, the 7 Race Course Road residence recommended more involvement of Panchayati Raj (village bodies) institutions in working of the PDS.
“For this, introduction of modern technology such as computerisation of PDS operations and the use of global positioning system to track vehicles carrying PDS commodities, smart cards of PDS beneficiaries and display of PDS related information on internet in consumer friendly manner have to be encouraged,” the prime minister’s core group recommended.
Thursday’s meeting came against the backdrop of India’s annual food inflation based on wholesale prices rising to 17.7 percent for the week ended March 27 from 16.35 percent the week before.
Over the past 52 weeks, pulses have become costlier by 32.6 percent, milk by 21.12 percent, wheat by 13.34 percent and rice by 8.8 percent, while the prices of potatoes and onions have started easing.
According to officials, six main issues were discussed during the meeting:
- How to raise the country’s farm productivity
- How to bridge the gap between prices at farm-gate and retail market
- How can the Essential Commodities Act be strengthened to prevent hoarding
- How to ensure better delivery of food and strengthen the public distribution system
- How the warehousing network in the country can be augmented, and
- How to ensure better seeds and fertilisers at fair prices to farmers
The core group decided to augment warehousing and storage capacity and build cold chains in the country, a major programme for building up storage capacity has to be taken up, a statement from the agricultural ministry said.
In a bid to tame prices and bring down inflationary expectations, the Reserve Bank of India has already initiated measures to tighten its monetary policy and suck excess liquidity out of the system by hiking some key rates.
“Inflation pressure is stronger than we anticipated. Between November 2009 and February 2010, in a space of four months, the wholesale price inflation has gone from 5.6 percent to 9.9 percent,” Reserve Bank of India Governor D. Subbarao said earlier this week.

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