Agencies
New Delhi, May 9:
Inflation crept up to a nearly four-year high of 7.61 per cent, impelling the government to think of more administrative measures to keep prices down such as goading cement manufacturers to cut rates. "More administrative steps will be taken as and when necessary," Finance Minister P Chidambaram said on Friday, as inflation rose to a 42-month high in the week ended April 26 on costlier tea, spices, fruits, vegetables and some manufactured products. It was 7.57 per cent in the week before and 6.01 per cent in the year-ago period.
It had last touched a high of 7.76 per cent on November 6, 2004. The government, which has been rolling out one measure or other almost every week to arrest and ultimately push down inflation, on Monday banned futures trading in four more farm commodities to stop speculation from feeding prices. "We are in the process of persuading cement companies to roll back prices.
If that succeeds, that will also be an administrative step," Chidambaram said, adding that the government's assessment was that inflation was "stable." While key steel producers have taken the cue and cut prices, cement maker ACC yesterday announced it would freeze prices for 2-3 months, while some others have already cut or are in the process of holding the price-line.
On the impact of the initiatives taken by the government and Reserve Bank on prices, Chidambaram said: "When the steps come together and take effect, there will be moderation... One must have faith that these steps will yield results." The government has so far announced measures that carry a revenue implication of Rs 6,300 crore to contain inflation, while Reserve Bank has increased the percentage of cash banks should keep in reserve (CRR) to tighten money supply.
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