The Hindu Business Line : Chidambaram hints at more fiscal steps to check inflation

New Delhi May 17 The Finance Minister, Mr P. Chidambaram, on Thursday said that he was willing to take more fiscal steps to check price rise in the economy and bring inflation below the five per cent mark. The average inflation in 2006-07 was 5.4 per cent.

He also indicated that the Government wants to bring inflation between 4-4.5 per cent, which is the range acceptable to the Reserve Bank of India.

"I am not happy with inflation. We are willing to take further fiscal steps if members so suggest", Mr Chidambaram told the Lok Sabha in his reply to a debate on price rise.

The Finance Minister highlighted that the Government has already taken various fiscal steps, including cut in customs duties on edible oil, ban on export of pulses and milk powder.

High oil prices

Mr Chidambaram attributed the high price situation in the economy to high global prices of crude oil and metals besides stagnation in agricultural production.

Moreover, rising remittances from NRIs and foreign direct investment, government spending for rural employment, education and health sectors have also contributed to high inflation, he said.

Bill on debt instruments

Parliament has approved a Bill that would pave the way for listing and trading of securitised debt instruments or certificates in the country's stock exchanges. The Rajya Sabha on Thursday passed the Securities Contracts (Regulation) Amendment Bill 2007 by a voice vote. The Lok Sabha had passed this Bill on May 14.

Replying to brief discussion on the Bill, Mr Chidambaram said that strict disclosure norms would be specified in the guidelines to be issued by the Securities and Exchange Board of India

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