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UPA faces more trouble on price rise |
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With the rate of inflation continuing its upward march, rising to 7.83 per cent for the week ended May 3, the Government continues to face heat from the Opposition and even the Left parties supporting it from outside.
The Left parties are holding a meeting on May 23 to discuss what they call the failure of the Congress-led UPA government to contain the price rise and its insistence on going ahead with the India-US nuclear deal. CPI general secretary A.B. Bardhan said in New Delhi that the steps taken by the Centre to check infla¬tion were not enough. He asked the Centre to ban futures trading in all 25 essential items and to bar big retail firms and corpo¬rates from buying foodgrains.
The CPI national executive at its meeting on May 11 said it is time to part with the Manmohan Singh Government. The party decided that this view should be conveyed to other Left parties at the Left Front meeting scheduled for May 23.
In a related move, Left parties on Friday, May 16, asked the Government to take urgent measures including banning of futures trading in essential items and action against hoarding to check the rising price graph. CPI(M) politburo member Sitaram Yechury said the UPA government has made a wrong diagnosis of the price problem, leading to the slowing down of the economy.
In another development, Agriculture Minister Sharad Pawar, trying to escape the blame for the price rise, said on May 11 that the Finance Ministry needs to take more stringent measures to control the price rise. The NCP national committee in a resolution adopted at its meeting appealed to the Government to have a thorough review of the fiscal management policy.
Inflation to come down by September, say PM : Calls for ‘pa¬tience’
Admitting that inflation has become a source of concern, Prime Minister Manomohan Singh said on Saturday, May 17, ap¬pealed for ‘patience’ and expressed the hope that inflation will start going down in the next few weeks with a good monsoon pro¬viding definite relief by September 15.
“Inflation is a problem,” he said even as he underlined that drastic steps could be counter-productive as it would slow down the growth and increase unemployment.
“Our objective was to keep inflation between 5 and 5.5 per cent. When we came to office inflation rate was 6 %. We succeeded in bringing it down. But in the last one year there have been events over which we have no control but which have influenced the sentiments of prices in our country,” he told reporters at Bagdogra after completing his two-day visit to Bhutan.
Giving reasons for the rising inflation, he said there has been an investment boom all over the world and the prices of metal, steel, and cement have all shot up and as a result of which the whole sale price index in India was closing on the 8 % per annum mark.
Asking citizens to have patience in the steps taken by the government to arrest inflation, he said, “my request to every one concerned is to have patience. I am confident that with the excellent procurement of food grains both wheat and rice , if we have a normal monsoon we will see a moderation in the price behaviour, but one has to be patient.”
Detailing the steps taken by his government so far, he said, “The RBI has raised the cash reserve ratio and the government has liberalised the import regime and restrict the exports. I request the public at large and political parties give these measures a chance to succeed. My feeling is that if the monsoons are normal in the next few weeks you will see a moderation in inflation after September 15.”
Global food shortages looming : Congress
Seeking to rationalise the price rise, the latest issue of Congress Sandesh, the party’s mouthpiece, says that worldwide exorbitant price rise has compelled even the United States and Japan to go in for rationing of food items at some places.
“Prices of food and other eatables are touching the sky throughout the world. Have we reached a situation where we have to take the 18th century economist Thomas Malthus seriously, who predicted cycles of population growth outpacing resources and leading to catastrophic decline ? Though the whole situation is not yet gloomy, is the world not standing on the verge of it ?” asked a column in the party mouthpiece.
The editorial of the magazine focused on rice rise, terming it as a “global phenomenon” and said the root cause of the prob¬lem was escalating oil prices internationally. “This has led to the growth of bio-fuels that have taken away land under food production in developed economies,” it said.
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