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Union Finance Minister, Arun Jaitley, today said that the Centre and States will work out action plan to contain inflation.
He said there were many recommendations from State Food Ministers. Some States wanted more powers under the Essential Commodities Act, some wanted more commodities under the Act, while some others wanted stricter penalties for hoarding, he said, while briefing the media during the State Food Ministers meeting here on Friday.
Jaitley said import of food items for boosting supply may end up in fueling inflation further.
Chairing a conference of State Food Ministers on price rise, Jaitley said: "If we have to import food items lilke pulses and lentils, and if the currency depreciates, then we end up importing inflation."
Prices of essential items such as onion and potatoes, besides pulses, have gone up anything between 15-68 per cent in the last three months. This is despite enough production of onion and potatoes, but fears over monsoon shortfall and apprehension of drought in some parts of the country are pushing the prices up.
However, Jaitley tried to calm down the fears of further price rise. "There is fear that vegetables that are selling at Rs 25-37 a kg will go up to Rs 100 like in the past few years. There is no reason to panic," he said.
He also admitted that some people are trying to exploit the situation. "So, it is the duty of good administration to anticipate and take measures. There is no point in intervening in the situation when it goes out of hand," he said.
He did mention that crude price rise is a cause for worry. But there is some relief as the prices have fallen from the peak levels. Crude prices for Indian basket had come to $108.13 on Thursday from $111 last week.
Six month action plan for curbing price rise :
* To cover rice, jowar, bajra, onions, tomatoes, potato, moong dal, masoor dal, tuar dal, edible oils, bread, milk and eggs
* Setting up price stablisation fund. When prices go up, State will buy commodities and sell at subsidised rates. Subsidy will be met through fund
* Making offence under Essential Commodities Act non bailable
* Inter state movement of onion to be freed
* At least one storage facility in each of 635 districts
* States to exempt perishable commodities from the APMC yard taxes and local fees till they are delisted from APMC Act
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