New Delhi, Jan 11 (Agencies): Under attack over rising prices, Prime Minister Manmohan Singh on Tuesday met with senior Cabinet colleagues and is understood to have discussed various options to check surging inflation, especially of food items. RBI Guv likely to meet PM on Wed
Apparently in the light of discussions in the meeting, a decision to export five lakh tonnes of sugar was put on hold by the Agriculture Ministry on Tuesday.
A host of measures, including possible monetary steps that can be taken by Reserve Bank were reportedly discussed at the meeting attended by Finance Minister Pranab Mukherjee, Home Minister P Chidambaram, Food and Agriculture Minister Sharad Pawar and Planning Commission Deputy Chairman Montek Singh Ahluwalia.
Indications are that the RBI Governor D Subbarao may meet the Prime Minister to discuss measures to tame inflation.
RBI has already taken steps to tighten monetary policies resulting in high interest rates and the next review by the central bank later this month could have further impact on interest rates.
The export issue would now go to an Empowered Group of Ministers, headed by Finance Minister Pranab Mukherjee.
Fuelled by high prices of onion and other vegetables, fruits, eggs,meat and milk, the food inflation has crossed 18 per cent affecting the common-man.
However, onion prices which could not be broght down below Rs 55-60 per kg may shoot up with traders in Azadpur Mandi in the capital threatening to go on indefinite strike from Wednesday to protest against income tax raids and surveys.
"Onion traders are feeling harassed by income tax raids and have thus decided to go on strike from Wednesday," Delhi Agricultural and Marketing Board Chairman Brahm Yadav said, adding auctions would not take place on Wednesday, disrupting the entire supply chain to the retail point.
But the Delhi Government has threatened to invoke Essential Services Maintenance Act (ESMA) against traders to ensure primary commodity supply.
The Centre, on its part, has asked the agri-cooperative NAFED to open more retail outlets in the NCR region to sell onion at Rs 35 per kg.
Amid rising food inflation, Prime Minister Manmohan Singh is likely to hold discussions with Reserve Bank Governor D Subbarao on Tuesday on the possibility of further monetary steps to check price rise.
The Prime Minister, according to sources, may meet RBI Governor to discuss price situation as part of the exercise to tame food inflation which soared to year's high of 18.32 per cent on December 25.
Worried over rising prices of onion, other vegetables and milk, Prime Minister met senior Cabinet colleagues earlier in the day to work out a strategy to deal with rising inflation.
Singh's meeting with Subbarao comes ahead of RBI's quarterly review of monetary policy on January 25.
The Reserve Bank has already raised the short-term key borrowing and lending rates six times in 2010 in a bid to raise cost of funds and check inflationary expectations.
With food inflation continuing to rise, experts were of the opinion the central bank could hike key policy interest rates (repo and reverse-repo rates) by at least 25 basis
points in its monetary review later in the month.
New Delhi, Jan 11 (Agencies): Under attack over rising prices, Prime Minister Manmohan Singh on Tuesday met with senior Cabinet colleagues and is understood to have discussed various options to check surging inflation, especially of food items.
RBI Guv likely to meet PM on Wed