Food prices will fall by March, says Montek

New Delhi: Forecasting that “food inflation” would ease out by the end of the current fiscal year (2009-10), the deputy chairman of planning commission, Dr Montek Singh Ahluwalia, on Sunday said, at the end of a bad monsoon, particularly at this point of time, the pressure is on vegetables.

 Speaking at the India Economic Summit here, Dr Ahluwalia said, “The rising food prices will come down by the end of current fiscal and it will be triggered by softening in the prices of vegetables.”

 For the week ended October 24, food inflation shot up by 13.39 per cent primarily on rising prices of potatoes and onions. The prices of potatoes have doubled on an annual basis while onions have become dearer by 50 per cent during the year.

 Drawing confidence from the comfortable food stock, Dr Ahluwalia said, “We are in a strong position as far as stocks (of food grain) are concerned. So, we don’t have to worry on that score. I think by December or January, at least with regard to vegetables, you will see a very different position.”

 Discussing the issue of poverty and the government’s plans to improve the lives of the people, who live below the poverty line (BPL), Dr Ahluwalia said, “The government has been following a strategy, which is focused on agriculture, rural infrastructure and delivering better services in health and education.”

 

Claiming that the government has successfully introduced the National Rural Employment Guarantee Scheme (NREGS) and has succeeded in raising the minimum wage in the country, the deputy chairman said, the rural consumption sustained the manufacturing or rather overall economy well during the global economic crisis.

 

“This is an indication that the social sector schemes of the government have worked to protect the incomes of the weaker sections,” he added.