Agencies
Washington, Apr 12:
Describing the soaring inflation in India as "a politically hot issue", the International Monetary Fund (IMF) on Saturday asked the Indian government to take immediate steps to arrest prices before the problem becomes entrenched and spills over.
Referring to the recent IMF reports on global and regional economy which said inflation was on the higher side and requires immediate attention, senior advisor in the IMF Asia & Pacific Department Kalpana Kochhar said, "At 7.5 per cent (inflation rate in India) it may not seem very high but politically it is a hot issue".
Kochhar said, "It was mainly due to food, fuel and some metals. Activities have come off a fast pace but are still pretty strong." It was critical to deal with the issue of inflation before it becomes entrenched and spills over, she added.
The annual rate of inflation in India, which was below 4 per cent in January soared to 7.41 per cent towards the end of March and is expected to move up further before beginning to cool down. Rising prices forced the government to take host of steps including banning export of non-basmati rice, pulses, edible oil and cement to contain inflation.
High inflation rate has already taken a political tinge in the country with the opposition Bharatiya Janata Party and Left allies accusing the government of its failure to check price rise.
Also, the issue is likely to caste a shadow on the upcoming assembly elections and finally the General Elections scheduled early next year.
`Left has no suggestions to deal with inflation'
Bangalore: Against the backdrop of Left parties sustained attack on UPA government on price rise issue, Congress on Saturday hit back saying its outside supporters have not made any 'real suggestions' on how to deal with the inflation except for seeking a ban on futures trading on commodities.
"As far as they (Left parties) are concerned, they have no real suggestions to give except that I have heard Sitaram Yechury (CPI-M leader) saying yesterday that we have to ban all futures trading", Congress spokesman and Union Minister Kapil Sibal said here, reacting to persistent criticism by Left on spiralling prices.
"Other than that, they have not said anything", he said. He said that on economic matters and inflation, the position of Congress and Left parties is different. Ideologically, Left parties have a different position on the economic situation. "They (Left parties) have a particular ideology. The fact of the matter is ideology of UPA government is slightly different from the perception of Left parties on what the solution should be", he said.
He asked BJP not to "play politics with inflation". "I request them (BJP)...let's have a debate (on inflation)". Listing steps taken to control inflation, including scrapping import duty on edible oil and banning export of non-basmati rice, Sibal said the Congress-led UPA is willing to take more steps to deal with it. "This government is committed to dealing with inflation effectively and strongly", he said. Terming the rising inflation as a global phenomenon, he said the inflation is not UPA-induced."We are not responsible for this (inflation)", he said.
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