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Journalism of Courage
The Centre has set up a special monitoring cell to “keep a daily watch on the price situation” and provide “support to state governments as required”.
The Prime Minister has written to all the chief ministers informing them of this decision amid rising pressure on his government to contain the recent spurt in inflation. The rate topped a two-year high at 6.73 in the first week of this month, having an immediate effect on bank rates for consumer loans and deposits.
The Centre has reacted by banning exports of several essential commodities and moderating prices of foodstuff like onions and pulses, but with limited success.
The letter urges the CMs to take steps to curb “malpractices, profiteering and hoarding” in their states. Singh draws attention to the various steps taken by the Centre to curb inflation and admits that “prices of some of the commodities has also been fuelled by speculation in the market”.
The note points out that the “Forward Market Commission has banned trading in urad and tur” and asks the CMs to ensure there is a strong monitoring of the “activities of anti-social persons who may indulge in speculation and profiteering”.
“I look forward to your personal intervention to help control prices and for ensuring adequate supplies of essential commodities to the consumers,” he tells the CMs.
Later today, the Cabinet Committee on Prices (CCP) chaired by the PM reviewed the price situation, including rising onion prices, and decided to take measures like cutting taxes and improving supply of essential commodities.
“The CCP reviewed the prices and decided that the government will take all the steps — fiscal, monetary and supply management — to moderate inflation,” Finance Minister P Chidambaram told reporters after the meeting.
Earlier, Agriculture Minister Sharad Pawar briefed the committee on the scheduled arrival of new crop of essential stuff including fruit, vegetables, wheat and pulses.
Asked if futures trading in agricultural commodities could be banned to contain inflation, Chidambaram said the Parliamentary Standing Committee had finalised its report on the issue and “the final view will be taken by Ministry of Agriculture”.
On the issue of soaring onion prices, the he said, “I have no magic wand to control onion prices.”
The likely role of speculation in rising prices has been a sore issue among politicians and experts recently. Agriculture minister Sharad Pawar on Wednesday admitted that he was under pressure to stop futures trading. “I do not know how long I will be able to resist (banning) it,” he said.
Market experts, however, insist that it is supply crunch, not futures trading, that has been stoking prices.
Also okayed: Salim in Bengal, IIM at Shillong, old age Bill
•w Indonesian conglomerate Salim group’s investments in West Bengal cleared
• Maintenance and Welfare of Parents and Senior Citizens Bill to be introduced in Parliament
• Taxation Laws (Amendment) Bill 2007 cleared to facilitate Central Sales Tax phaseout
• Double Taxation Avoidance Treaty between India and Myanmar
• Special Incentive Package for attracting investments in semiconductor and nano-technology manufacturing
• A new Indian Institute of Management at Shillong
• 109 Customs Marine Vessels to be acquired
• National Mineral Policy sent to Group of Ministers
• MMDR Act amendment referred to GoM
