The government will not remain passive and fiscal, monetary and supply side measures were in the offing to contain inflation, said FM.
NEW DELHI: The government will not remain a passive spectator when cement prices rise abnormally and fiscal, monetary and supply side measures were in the offing to contain inflation, Finance Minister P Chidambaram told the Lok Sabha.
Winding up the debate on Budget 2007-08, amid loud protests from Opposition benches, Chidambaram read a part of his budget speech. Later, the house passed the Vote on Accounts through a voice vote.
"Government cannot plead helplessness or remain passive when the price of a commodity such as cement rises abnormally and at a very fast rate," the Finance Minister said.
He said the government is still hopeful that cement manufacturers will realise their responsibility and moderate prices.
Pointing out that inflation is largely driven by rise in prices of primary articles, Chidambaram asked all state governments to take measures against hoarding.
Five states have imposed limits on wheat and pulse stocks, he said, while urging "other state governments to heed the advice of the Prime Minister and impose stock limits and start de-hoarding operations."
Admitting that inflation is a major concern for the common man, he said long-term answer is to increase production and productivity in the farm sector.
He asserted that agriculture is at the top of the priority list in Budget 2007-08, and government will address critical issues affecting the sector like credit, water, seeds, fertiliser and power.
The UPA government has substantially increased minimum support price for wheat and paddy in the past three years, he said, adding the Cabinet has on Thursday taken some decision concerning wheat prices.
The Cabinet has decided to offer a bonus of Rs100 per quintal of wheat, over and above the minimum support price (MSP) of Rs750 per quintal.
"The UPA government stood solidly by the farmer and has strained every nerve to make farming a viable proposition."
Referring to the recommendations of National Farmers Commission to lower interest rate on farm credit by removing inefficiencies of the delivery system, he said: "We shall keep in mind this recommendation while finalising the National Policy on Farmers."
The Finance Minister assured the Lok Sabha that government will take all steps to moderate inflation.
"I recognise the burden on the people, but this burden will ease over the next weeks and months," he said.
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