Ans:-
Indian
government taken various measure to check inflation in the recent past “The
government set up an inter-ministerial group (IMG) under Kaushik Basu, the
Chief Economic Advisor to the finance ministry, to build an ‘institutional
machinery’ that can read short-term supply shocks and recommend appropriate
measures to tackle spike in inflation in future.
“The IMG will, inter alia, review production/rainfall trends
and build an institutional machinery to read warning signals, assess global
trends, recommend action on fiscal, monetary, production, marketing,
distribution and infrastructure fronts to prevent price spikes, and suggest
measures to strengthen collection and analysis of data and forecasting,” said a
press communiqué issue by the media advisor to Prime Minister.
“The rise in prices is partly due to late rains, which
affected the onion crop. There is also an underlying increase in prices of
milk, eggs, meat and fish, which is the result of a fast growing economy,
leading to rising income levels, combined with the effect of several
inclusiveness programmed which put greater income in the hands of the
relatively poor whose food consumption increases,” said the statement
.
“The current bout of inflation is driven by a rise in prices
of vegetables and fruits which is more difficult to manage because these
commodities are not held in public stocks,” it said. The government also
underlined the challenges in dealing the inflation arising out of vegetables,
fruits, and meat products. “As incomes rise, demand shifts towards
horticultural crops, dairy products. These are perishable and need sustained
development of market facilities, cold storage, etc., quite different from what
is needed for food grain,” said the government.
The government also asserted that it would take ‘stringent
action’ against hoarders and cartels manipulating the markets. It also said
that Centre would request the states to take action against hoarders and black
marketers under Essential Commodities Act, 1955 and the Competition Act, 2002.
The government announced ‘urgently’ finalizing a scheme to
support state governments in the setting up of farmers’ mantis and mobile
bazaars along with improving the state civil society corporations and state
cooperatives to intervene effectively in the domestic market in this kind of
situations in future. It also called for strengthening the PDS and opening of
more procurement windows across the country.
In another step, the government said the Departments of
Industrial Policy and Promotion, Food and Public Distribution, Food Processing
Industries and the Planning Commission to “jointly work out” a scheme to boost
the investment in supply chains, including cold storages that can be
“dovetailed” with organized retail chains for quicker distribution of farm
products in these kinds of situations.
