Raising Farm Output Only Way to Deal With High Inflation:FM
Tuesday, 18 October 2011, 21:24 IST
Printer Print Email Email
Bangalore: With food inflation hovering around the double-digit mark, Finance Minister Pranab Mukherjee today said the only way to deal with the problem of rising prices on sustained basis is boosting the farm output. "Like many other countries, food security and volatility in prices has been a matter of concern for India. We recognise that increase in agricultural production on a sustainable basis is the only long-term solution to the problems of availability as well as high and fluctuating food and commodity prices," he said. Both intellectual and innovative physical efforts are needed to give a new meaning to the concept of sustainable development, he said at ADB-India partnership Silver' class='bD_15arlink' title='silver price'>silver jubilee celebrations here. Speaking to reporters, Economic Affairs Secretary R Gopalan said inflation was expected to come to 7% by the end of March this fiscal. "I expect around 7% (inflation) by March-end. It (current inflation) is too high from comfort level," he said. Overall inflation increased to 9.72% in September 2011 from 8.98% in the year-ago period, as prices of food and manufactured items continued to escalate. However, general inflation, as measured by the Wholesale Price Index (WPI), was marginally lower than the 9.78% figure recorded for August. The food inflation for the week ended October 1 slightly declined to 9.32% against 9.41% in the previous week. The year-on-year rise in inflation has raised the prospects of another rate hike by the Reserve Bank later this month. The RBI has already hiked rates 12 times since March 2010 to tame inflation. Chief Economic Advisor Kaushik Basu said partly attributed rising inflation to high wages. In India, the biggest inflation in the last one-and-a-half years is taking place in the labour-intensive sector," Basu said. "This is a sign of rising cost of labour and also we have data now that wages are inflating faster than good and services," he said. Urging the Manila-based multilateral agency to help nations achieve sustainable growth, the Finance Minister said, "We look forward to drawing on ADB's vast experience and expertise for implementing projects that contribute to a more efficient use of water and other natural resources." ADB needs to focus on issues that help in linking farms to markets and promote research activities and efforts in improving productivity of dry-land farming, efficient use of water, rain-fed irrigation, development of drought-resistant varieties of seeds and other similar concerns, Mukherjee said.
Source: PTI