MINISTER OF STATE IN THE MINISTRY OF FINANCE
(SHRI NAMO NARAIN MEENA)
(a) and (b) The impact of inflation on rural and urban areas differs because
of the diverse consumption pattern and income distribution. To capture price
movement in rural and urban areas, Labour bureau compiles and releases Consumer
Price Index for Rural Labourer (AL/RL) which is pertaining to rural segment of
population and Consumer Price Index for Industrial Workers (CPI-IW) which is
pertaining to urban segment of population in the country. Based on these two
indices, year-on-year inflation rates for two segments are given below in the
table:
January-2010 April-2011 May-2011 June-2011 July-2011
CPI-RL 17.35 9.11 9.63 9.14 9.03
Inflation (%)
CPI-IW 16.22 9.41 8.72 8.62 -
Inflation (%)
(c) to (e) The Government is aware that inflation hurts the lower income group
of society. Measures taken to contain prices of essential commodities include;
import prices reduced to zero on rice, wheat, pulses, edible oils (crude) and
onion, ban on export of non-basmati rice, edible oils (except coconut oil and
forest based oil) and pulses (except Kabuli chana and organic pulses upto a
maximum of 10000 tonnes per year), futures trading suspended in rice, urad and
tur by the Forward Market Commission, stock limit orders extended in the case
of pulses, paddy and rice up to 30 September 2011, duty under Tariff Rate Quota
(TRQ) for Skimmed Milk Powder (SMP) reduced from 15 per cent to 5 per cent for
import upto an aggregate of 10000 metric tonnes in a financial year, import of
30000 tonnes of Milk Powder and 15000 tonnes of Milk Fat at zero duty allowed
to National Dairy Development Board (NDDB) during 2010-11 under TRQ, reduction
in custom duty on crude oil and import duty on petrol and diesel.
As part of the monetary policy review stance, the RBI has taken suitable steps
with 11 consecutive increases in policy rates and related measures to moderate
demand to levels consistent with the capacity of the economy to maintain its
growth without provoking price rise. As per the most recent announcement of the
RBI on 26 July 2011, the repo rate and reverse repo rate have been revised to 8.0
per cent and 7.0 per cent respectively. In response of anti inflationary policies
of Government, the CPI-RL based inflation has eased to 9.03 per cent in July 2011
from its peak of 17.35 per cent in January 2010.
