By IANS,
New Delhi: Amid shooting commodity prices and a deficient monsoon, Prime Minister Manmohan Singh Tuesday assured that the government was taking all possible steps to contain food inflation and said the country had enough food stocks to meet any exigency.
He told a delegation from the Federation of Indian Chambers of Commerce and Industry (FICCI) that the government was taking stock of the drought situation and will do everything possible to deal with the impact of deficient rains and food inflation.
“The prime minister was quite confident that the country has enough buffer stock and the government will be able to handle the food inflation efficiently,” FICCI secretary general Amit Mitra told IANS after a review of the government’s 100-day agenda.
“He also told us that central agencies like the Food Corp of India have buffer stocks of 50 million tonnes of rice and wheat, which will help tackle both availability and prices of food in the country,” Mitra added.
The prime minister’s comments also came against the backdrop of Finance Minister Pranab Mukherjee’s warning that the spectre of drought looms large over as many as 161 out of 626 districts in India due to deficient monsoon.
“One hundred and sixty one districts have been declared drought-prone. As far as sowing is concerned, 20 percent would be down,” Mukherjee told reporters Tuesday on the margins of an annual conference with officials of the income tax administration.
“Monsoon situation is still erratic,” he warned, but added: “But there is no point of pressing the panic button. You all will go and start chanting drought, drought, drought and it will have an adverse impact.”
Nearly 60 percent of India’s farm sector is dependent on monsoon rains between June and September, but this year has witnessed one of the driest spells in eight decades, as per the Indian Meteorological Department.
The met department said the average monsoon rainfall has been deficient by 25 percent in the country for the monsoon period June 1 to Aug 5. The shortfall has been far higher in traditional breadbasket states like Punjab and Haryana.
The prime minister had cautioned Monday that the reduced production of kharif crops, sowing for which coincides with the monsoon, may have an inflationary impact on prices of food items in the coming months.
He, accordingly, urged all states to work together with the central government and activate the public distribution system.
“The contingency plan for crops, drinking water, human and animal health, fodder should be brought into operation without delay and a close watch kept on availability of food grain and prices of essential commodities.”
During the meeting Tuesday, FICCI requested the prime minister to consider various measures to boost productivity in other sectors of the economy so that the growth can be maintained.
“With farm sector performance likely to be weak this year, it becomes important for us to further push manufacturing and services sector to pick the slack,” FICCI president Harshpati Singhania said in his proposal to the prime ninister.
“We feel the situation is better for large borrowers. But small and medium enterprises are not getting the benefit of low rates. They find it difficult to meet the requirement of banks. So there is a need to find for alternative sources of funds for them.”
FICCI also said investments in agri-market infrastructure should be included in the priority lending of the banks and also, extend weather based insurance programme to all states and all crops.