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Govt agonizes over ways to curb rising prices
Published on 12 Jan. 2011 9:19 PM IST
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Finance Minister Pranab Mukherjee met Agriculture Minister Sharad Pawar and senior government officials Wednesday to discuss measures to curb rising food prices as a follow-up to the meeting Prime Minister Manmohan Singh chaired on the issue.
That meeting Tuesday ended with a few measures being suggested - among them reconsidering some of the government’s decisions related to food items like export of 5 lakh tonnes of sugar, and increasing prices of wheat and rice sold through the public distribution system to above poverty line families.
The meetings Mukherjee called Wednesday, which also included Deputy Chairman of the Planning Commission Montek Singh Ahluwalia, will discuss these and other options before the government, according to an official who was privy to the issue.
India’s food inflation has soared to over 18%, led by onions which are selling in most parts of the country at Rs.55-60 per kg.
An official in the Prime Minister Office also said that the ministers would give their opinions on measures the government could adopt to curb inflation.
The prime minister is also expected to meet Reserve Bank of India Governor Duwuri Subbarao Wednesday to discuss ways of curbing high inflation.
Analysts and India Inc widely expect the central bank to raise key interest rates in order to pull down inflation - a move which could have an adverse impact on industrial output that slowed down to an 18-month low in November.
According to official figures, the index for industrial production nudged upwards by a meagre 2.7% in November, losing close to 9 percentage points from the 11.3% growth it logged in the like month of 2009. Even in October 2010 the IIP had risen by 11.29%.
Meanwhile, opposition parties - from the Left Front to the BJP-led National Democratic Alliance (NDA) - have scheduled a series of public rallies to highlight the price spike, particularly of essential food items.

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