The Hindu : National : `Inflation rate will come down'

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Friday, Aug 20, 2004

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National

`Inflation rate will come down'

By Our Special Correspondent

NEW DELHI, AUG. 19 . The Union Finance Minister, P. Chidambaram, today expressed confidence that the inflation rate would come down soon, following the decision to cut down the customs and excise duties on petroleum products.

Briefing reporters after a meeting of the Union Cabinet's Committee on Prices, he said the meeting reviewed the availability of essential commodities and it was found that there was ample supply of all, be it foodgrains, edible oil or pulses. Perhaps, because of drought in some areas and flood in some others, there might be some seasonal fluctuations. But, there was no cause for worry, he said.

Mr. Chidambaram said the Government would ensure that the situation of ample supplies continued. "We would carefully monitor the prices and, if necessary, some more measures on the fiscal side would be taken. As it has happened in the past, we are confident that the inflation rate will stabilise after some time." He noted that the inflation rate in India was measured on the basis of the wholesale price index and that if it had been measured on the basis of the consumer price index, as was done in most countries, it would have been still lower, at about three per cent only.

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