Containing food inflation top priority for government: Finance Minister

Concerned over the high food inflation in the country, Finance Minister Arun Jaitley has asserted that controlling food inflation is a top priority for the government. CPI inflation in food articles increased by 9.36% y-o-y in July as compared to 7.97% in June mainly driven by higher price of  fruits & vegetables, maize, condiments & spices and urad on account of below normal monsoon in the country. High food inflation also increased the retail inflation to 7.96% in July as compared to 7.31% in the previous month, restraining central bank’s scope for easing policy rate.

Attributing weak policy measures as well as seasonal factors for increase in food prices, Finance Minister stressed that food inflation, which has been hovering near double digit mark, has become a major issue for the country. However, the Minister assured that there is no need to worry as the country has sufficient food stocks. Besides, the new government has been taking measures to check food prices.

In order to contain food inflation, the government has recently taken steps such as de-listing of fruits and vegetables from Agricultural Produce Marketing Committee Act, bringing onion and potato under the Essential Commodities Act, fixing minimum export price of $500 per tonne and $450 per tonne on export of onion and potato respectively. Further, an additional 50 lakh tonne of rice has been allocated for distribution toward Below Poverty Line (BPL).