New Delhi: Emphasizing that controlling inflation is the government’s top priority, Prime Minister Manmohan Singh on Monday said rising prices are as a result of global factors like high commodity and oil rates.

“Controlling rising prices is the primary responsibility of any government... Sometime, we have been confronted with a situation in which the reasons for rising prices lay outside the country. The prices of petroleum products, foodgrains and edible oil have risen steeply in international markets in recent times," Singh said in his Independence Day address to the nation.

Prime Minister Manmohan Singh addressing the nation from the historic Red Fort during the 65th Independence Day function in New Delhi on Monday. PTI photo

Barring the past few weeks, commodity and crude prices have been rising in global markets, affecting the Indian economy which largely depends on imports for meeting its oil requirements.

Food inflation for the last week ended July was 9.90%, while the general inflation was ruling at 9.44% in June.

“Our country is passing through a phase of sustained high inflation," the Prime Minister said, adding, “I wish to assure you that we are continuously monitoring the situation to find out what new steps can be taken to arrest rising prices.

“Finding a solution to the problem will be our topmost priority in the coming months," Singh said.

Singh said the road ahead is long and arduous in the wake of slowing world economy. “Particularly, the prevailing situation, both inside and outside the country, is such that if we do not act with understanding and restraint, our security and prosperity can get adversely affected," he said.

The world has recognized India’s potential to be one of the major economic powers globally, the Prime Minister said, adding, however, that the “problem of corruption is a big obstacle in such a transformation".

The situation of price rise can be tackled by increasing supply of essential commodities, he said, complimenting farmers for taking India’s foodgrain production to a record level.

According to fourth advance estimates, the country has achieved a record 241.56 million tonnes of foodgrains production during 2010-11 crop year (July-June).

“I congratulate the country’s farmers for their achievement this year... Wheat, maize, pulses and oilseeds have all seen record levels of production...Today there are proposals for export of foodgrains, sugar and cotton," he said.

He assured the people worst affected by price rise that the government will soon enact a legislation for providing food security to them.

To further boost the farm production, the government would accelerate efforts during the 12th Plan (2012-17).

“We need a second Green Revolution in agriculture. We can tackle the problem of rising food prices only by increasing agriculture production and productivity. We also need to increase agriculture production to implement a food security law," the Prime Minister added.

Singh also assured farmers that the government would continue to take care of their needs, especially with regard to easy access to fertilizers, seeds and credit.

The Prime Minister sought to dispel apprehensions that there is a policy paralysis in the government affecting the reform process.

“ ...we should all stay away from politics that create suspicion or apprehension amongst those connected with industry, business and investment," Singh said, adding, “Our industrialists should have the opportunity to set up new industries so that our youth can get additional avenues for productive employment."

The government has been strengthening the physical infrastructure like airports, roads and ports, he said, asserting that in the 12th Plan, investment in these sectors would be further accelerated.

According to a Plan document, India wants to invest a huge $1 trillion in the infrastructure in the next Plan.