New Delhi: Mounting pressure to contain rising prices notwithstanding, Prime Minister Manmohan Singh on 8 March claimed in Parliament that the measures taken by the government had already started showing results.
“There are indications that the rate of inflation declined by nearly one percentage point in the last two weeks,” Singh told Lok Sabha in his concluding reply to the debate on the motion of thanks on the President’s address to both Houses of Parliament.
Singh’s assurances followed protests by the Opposition as well as Left parties over what they said was inadequate reference to inflation in the Presidential address.
Inflation has been easing since it hit a two-year high of 6.73% for the week ended 3 February. “We are trying to curb inflationary pressures without adversely affecting the strong growth impulses which now characterize our economy,” the PM said. He explained that supply-side shortages could be relieved through imports, but the government’s effort had been to do so without affecting the profitability of domestic agriculture.
The ruling coalition has been at pains to convey its resolve in tackling inflation. While addressing the Congress parliamentary party barely two days ago, party president and UPA chairperson Sonia Gandhi had acknowledged that “prices remain a source of worry”, but assured: “Our party and the government are in regular touch. (The) government has already announced a large number of measures.”
However, both BJP and the Left have been blaming the government for doing too little, too late. “The ban on futures trade came too late, after repeated demands from our side, and even then in just a few selected products,” said CPI(M) politburo member Sitaram Yechury. He said the problem was not the lack of adequate production of food products, but rather a failure of proper procurement. BJP’s V.K. Malhotra concurred, saying the government had failed to crack down on hoarders.
Finance minister P. Chidambaram too has been under fire in Parliament over this issue. In a heated exchange in Rajya Sabha earlier this week, former member secretary Planning Commission and economic advisor to the Prime Minister, Arjun Sengupta accused the minister of “gross mismanagement” for not following “the right kind of import policy”. “The problem today is the problem of supply and the finance minister, sitting on $180 billion of foreign exchange can’t say that our country is facing a supply shortage in any product which is importable,” said Sengupta.
The minister, however, refuted the charge clarifying the government had imported whatever could be imported.
With Sonia Gandhi flagging price rise as a possible factor in the defeat in Punjab and Uttarakhand polls, the government has been put on alert —especially with the crucial polls in UP starting 7 April.