By IANS
New Delhi : India’s benchmark inflation rate will remain at over 4 percent for fiscal 2007-08, Finance Minister P. Chidambaram said, adding that efforts would continue to bring down prices.
Chidambaram Thursday tabled the Economic Survey 2007-08 in the Lok Sabha amid din, with opposition members shouting slogans about alleged government apathy towards farmers’ problems.
“Inflation is expected to be above 4 percent. Our efforts will be to further contain it,” Chidambaram told reporters outside parliament after tabling the report.
Though inflation has declined from 5.6 percent in 2006-07, it shot up to a six-month high of 4.35 percent for the week ended Feb 9, as against 4.07 percent and 4.11 percent in the two weeks preceding that.
Also in the first week of February, prices of food articles such as fruits and vegetables, condiments, spices, fish, arhar (pulses), millet and barley rose, the data showed.
The Economic Survey attributed the projected decline in inflation to the deceleration in the prices of investment goods from 5.5 percent in 2006-07 to 4.3 percent in 2007-08.
The survey says that inflation as measured by the wholesale price index rose from 4.4 percent in 2005-06 to 5.4 percent in 2006-07, and is expected to be around 4.4 percent for the full year of 2007-08.
According to the survey, a hike in fuel prices Feb 15, as per preliminary estimates, is expected to add 19 basis points to the inflation rate, taking it to above 4 percent.
“The year-on-year rate of inflation declined to less than 4 percent in mid-August 2007 after a gap of 67 weeks. The overall inflation has remained below 4 percent since then for 23 consecutive weeks, before inching up to 4.1 percent in the last two weeks.”
The survey says that primary articles, which substantially contributed to increase inflation in 2006-07 and in the first five months of the current fiscal, were “major contributors to the deceleration of inflation”.
“The inflation of primary articles declined from 12.2 percent on April 7, 2007 to 3.8 percent on January 2008, the lowest level since early November 2005.”
The wholesale price index data is released weekly and considered the benchmark inflation indicator. The inflation rate stood at 6.52 percent in the corresponding week last year.
The ministry of commerce and industry last week revised the inflation rate for the week ended Dec 15 to 3.84 percent from 3.45. The government revises the rate after receiving additional price data.