Finance Minister P. Chidambaram is hopeful that the various steps being taken by the Government to put a lid on food prices will yield results over a period of time.
“We are taking a number of steps to contain food inflation and you will see the results over a period of time,” Chidambaram told the Lok Sabha during question hour on Wednesday.
Although headline inflation and core inflation rates had come down, retail inflation (as measured by the consumer price index) remained high at 10.91 per cent, mainly on account of a rise in food prices, Chidambaram said.
“The high CPI inflation is driven by food inflation. Every component of food inflation is high,” he said.
One of the ways food inflation can be tamed is by improving the supply mechanisms, according to Chidambaram.
“The reason why food inflation is high is because we do not have an effective distribution channel or logistics chain.
“That is the reason we say the distribution channel and logistics chain have to be improved so that what is produced in the farm comes to the market.”
Earlier in the day, Prime Minister Manmohan Singh had told Parliament that the economy will return to robust growth in two to three years.
Singh said the Government was trying to tackle issues affecting economic growth.
“Although we are in difficulty, we are confident that in two to three years, we will return the economy to its robust growth (path),” Singh said.
The Indian economy, which is largely expected to record the decade’s lowest growth rate of about five per cent in the current fiscal, has put policymakers in a spot.
srivats.kr@thehindu.co.in