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Not Achieved Lasting Success In Tackling Inflation: PM

PTI 15 Aug 2011, 19:17:53 IST

New Delhi, Aug 15: Against the backdrop of high dependence on imported petroleum products, Prime Minister Manmohan Singh today said sometimes the reasons for price rise lay outside the country and added that the government's efforts to tame inflation have not met with lasting success.

“The prices of petroleum products, foodgrains and edible oil have risen steeply in international markets in recent times. Since we import these products in large quantities, any rise in their prices adds to inflationary pressure in our country,” Singh said in his Independence Day address to the nation.

“Sometimes we have been successful too in controlling inflation. But this success has not proved lasting,” Singh said.

Noting that sometimes the reasons for rising prices lay outside the country, Singh stressed that the government would consider new steps to arrest rising inflation.

“Our country is passing through a phase of sustained high inflation. Controlling rising prices is a primary responsibility of any government,” Singh said.

In recent times, the prices of petroleum products, foodgrains and edible oil have gone up steeply in international markets. Both food and general inflation have remained stubbornly high.

Last year, India's oil import bill was about USD 106 billion, when the average crude oil price was hovering around USD 55 to USD 60 per barrel.

The Reserve Bank of India has embraced a hawkish monetary policy to tame inflation, which touched 9.44 per cent in June.

Food inflation jumped to a four-and-half month high of 9.90 per cent in the last week of July.

Grappling with rising inflation for more than a year, the central bank has hiked interest rates 11 times since March, 2010.

In its Economic Outlook for 2011-12 released earlier this month, the Prime Minister's Economic Advisory Council had projected headline inflation to remain high at around 9 per cent till October. PTI