Government eases import norms to curb price rise
The Govt has allowed the private sector to import wheat and sugar while ordering an immediate ban on the export of pulses.india Updated: Jun 22, 2006 17:06 IST
To curb the galloping prices of essential commodities, the government on Thursday allowed the private sector to import wheat and sugar while ordering an immediate ban on the export of pulses.
"These decisions were taken by the cabinet committee on prices which discussed the issue of price rise for about one-and-a-half hours today," Finance Minister P Chidambaram said at a press conference.
"The government is confident that inflationary expectations will be dampened in the economy after Thursday's decision which aims at handling the supply side constraint," the Finance Minister added.
The Finance Minister said wheat, sugar and pulses were the three prime articles showing a rising price trend and driving the price rise. "As far as the prices of vegetables and fruits are concerned, there are always seasonal fluctuations."
He did not rule out the possibility of hoarding by private traders in some states. "I urge the state governments to deal with this problem urgently".
The Finance Minister said the Cabinet Secretary has been directed to suggest ways to regulate the commodity market as a bill aimed at providing a regulatory mechanism for the commodity market is still pending in Parliament.
"The Cabinet Secretary would give his report in the next few days," the Finance Minister said.
Chidambaram said after Thursday's decision by the Cabinet committee on prices, the private sector, especially flour mill owners producing wheat products, could import wheat from the international market.
"The output of wheat has been stagnating at a particular level for the last seven or eight years whereas the demand is rising. A technological breakthrough is needed to increase the output further," Chidambaram said.
"The import of sugar by the private sector will be allowed till Sept 30 when the current season ends," he said.
"The Government is expecting sufficient sugar production in the next season," the Finance Minister said.
"There has always been a gap between domestic demand and production of pulses and for the last many years we have filled this gap by imports. Now the Government has decided to halt the export of pulses immediately to augment its supply in the domestic market," he added.