(a)whether the Government expects high rate of economic growth despite sky rocketing prices of food articles and other essential commodities; and
(b)if so, the details thereof and steps taken or proposed to be taken in this regard?
(a)whether the Government expects high rate of economic growth despite sky rocketing prices of food articles and other essential commodities; and
(b)if so, the details thereof and steps taken or proposed to be taken in this regard?
MINISTER OF STATE IN THE MINISTRY OF FINANCE(SHRI NAMO NARAIN MEENA)
(a)and(b) The professional forecasters’ survey of the Reserve Bank registered
a marginal upward revision in the GDP growth rate for 2010-11, on the back of
higher growth forecasts for agriculture and services sector. The recovery which
spans all three sectors, viz., agriculture, industry and services is estimated
at 8.8 per cent in the first quarter of current financial year 2010-11; it is
in line with growth projection of 8.5 ± 0/25% in 2010-11.
The Government has taken a number of anti-inflationary measures to bring down
the rate of inflation which has moderated to 8.58 per cent in October, 2010 from
the headline inflation of 11 per cent at the beginning of the current financial
year. The food inflation (weight 24.31 %) reached its peak of 20.22 per cent in
the month of February, 2010, thereafter, declined to 18.50 per cent in March
2010 and further to 9.97 per cent in October, 2010.
Government monitors the price situation regularly as price stability remains
high on its agenda. Measures taken to contain prices of essential commodities
include selective ban on exports and futures trading in food grains, zero import
duty on select food items, permitting import of pulses and sugar by public
sector undertakings, distribution of imported pulses and edible oils through PDS
and release of higher quota of non-levy sugar. RBI has taken suitable measures
to moderate demand levels consistent with capacity of the economy to maintain
its growth without provoking price rise. Accordingly, the Repo rate and Reverse
Repo rate increased to 6 per cent and 5 per cent respectively on September 16,
2010 from a level of 5.75 per cent and 4.50 per cent respectively. Further
during their Second Quarter Policy Review on November 2, 2010 RBI raised the Repo
rate and Reverse Repo rate to 6.25 per cent and 5.25 per cent respectively.