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Be patient on inflation: Manmohan

Special Correspondent

‘If we have a normal monsoon this year, then we will have a moderation of prices’

Manmohan Singh

Bagdogra: Acknowledging that inflation was a major concern of the government, Prime Minister Manmohan Singh said on Saturday that corrective measures were being taken and that there would soon be some relief on the price front.

Dr. Singh said inflation was 6 per cent when his government came to power in 2004 and he had 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.”

Blaming the worldwide investment boom for the increase in the price of steel and cement, he said this had pushed the wholesale price index in India close to 8 per cent. The government has since taken “effective steps” such as requesting steel and cement manufacturers to reduce prices, he said. “I am hopeful that in the next few weeks there will be some moderation of inflation.”

What made the government’s job particularly difficult was the need to “control inflation without interrupting the rhythm of the growth process, which is moving forward at 8 to 9 per cent over the past four years,” said the Prime Minister. “This delicate process is not easy. My request to everyone is to have patience. I am confident that with the excellent procurement of rice and wheat, if we have a normal monsoon this year, then we will have a moderation of prices.” He said that if the monsoons are normal in the next few weeks, “you will see a moderation in inflation after September 15th.”

Insulating the poor

The Prime Minister sought to emphasise that his government had adopted significant measures to insulate the poor from inflation. “The price of grain through the Public Distribution System has not been increased at all despite rising procurement costs,” he said. And despite the fact that international oil prices had risen four-fold since his government came to power, the price of kerosene had not been increased in four years and there has only been marginal increases in the price of diesel, petrol and LPG.

He characterised the government as following a two-fold anti-inflation strategy of increasing production, liberalising imports and discouraging exports where necessary, and of using the PDS to protect the poor. Urging patience all around, he said the government did not have a magic wand. “I request the public at large and political parties give these measures a chance to succeed.”

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