Ensure proper supplies to contain food inflation: India Inc
Demanding an “accomodative” monetary policy, industry cautioned that the double whammy arising out of declining industrial output and rising WPI inflation may hurt the economy’s growth prospects in the long run.
“This clearly calls for a more proactive management from the supply side. We hope that the situation would be managed well and that inflation will remain within RBI’s indicative trajectory. “We need to broad base the growth impulses and this calls for support by way of an accommodative monetary policy,” Ficci President Harshavardhan Neotia said.
Food inflation rose to 7.88 per cent in May as against 4.23 per cent in April, showed a government data on Tuesday. Inflation in vegetables came in at 12.94 per cent, a sharp rise from 2.21 per cent, a month earlier. Pulses inflation remained stubborn at 35.56 per cent.
“Policymakers need to check and address through supply side responses the continuous rise in prices of commodities like pulses, food articles, cereals, wheat and other items of national interest that have been soaring continuously,” Assocham Secretary General D S Rawat said.
He cautioned that the declining trend in industrial production and rising WPI may have negative impact on country’s economy in the long run. The April wholesale price-based inflation (WPI) was at 0.34 per cent and in March it was (-)0.45 per cent while it stood at (-)2.20 per cent in May last year.