India’s rising incomes to pressure food supply: PM1 min read . Updated: 01 Feb 2010, 02:08 PM IST
India’s rising incomes to pressure food supply: PM
New Delhi: Rising prosperity will increasingly put pressure on food supply in India and the country urgently needs to boost farm productivity, Prime Minister Manmohan Singh said on Monday.
After last year’s failed monsoon rains, food prices have jumped in India, one of the world’s top consumers of sugar, wheat, edible oils, rice and lentils, triggering protests in poorer regions and putting pressure on authorities to tighten monetary supply.
Indian demand has helped New York raw sugar futures surge to the highest in 29 years.
Singh told a meeting of top bureaucrats from Indian states that the country needed to increase farm productivity as food supply was an area of concern.
“Many felt that we have been able to control prices. But we have learnt that our growing population and higher levels of living necessitate augmentation of our food supplies," he said.
Last year, sugar prices in India doubled in step with global prices and forced India to import large quantities to ensure steady supplies.
“We must also recognise that in a globalised world, it will never be possible to insulate ourselves from the pulls and pressures of international demand and supply," Singh said.
He urged state governments to take steps to boost food output and tackle shortages of essential commodities.
India’s consumption of items such as sugar, wheat, vegetable oils and lentils has increased steadily as the world’s third-largest economy expanded rapidly.
Analysts say the government’s welfare schemes and its focus on rural development has further increased demand in villages.
India’s central bank last week lifted its wholesale price index inflation forecast for the end of the fiscal year in March to 8.5% from 6.5% and upgraded its economic growth forecast for 2009-10 to 7.5% from 6%, predicting a similar rate of growth the following year.
It said it expected inflation to moderate from July, assuming a normal monsoon and steady oil prices.