January 20, 2007

Press Statement

The Polit Bureau of the Communist Party of India (Marxist) has issued the following statement:

Take Steps to Control Price Rise

The Polit Bureau of the CPI(M) expresses serious concern at the rising rate of inflation which has now crossed 6 per cent.  It is to be noted that the increase in the overall inflation rate is driven by spiraling prices of primary articles, mainly food items. Increase in prices of fuel and some manufacturing inputs like metals and cement have also contributed to the inflationary trend. The poorer sections are being particularly hit because of the rise in prices of pulses, vegetables and cereals.

The CPI (M) has been demanding that the UPA Government should take concrete steps to check price rise. The inability of the Government to improve the supply situation by augmenting production and cracking down on hoarding is responsible for the continuing increase in prices of food items. Speculative trading in the commodity futures market has further aggravated the situation. The successive increases in petrol and diesel prices under the UPA regime also had a cascading impact on prices across the economy. In view of this, the CPI (M) reiterates that the following steps should be taken by the Government without further delay:

1. Ban futures trading in essential commodities as recommended by the Standing Committee on Food, Consumer Affairs and Public Distribution.

2. Reduce prices of petrol and diesel in view of the drop in international crude prices to $50 a barrel.

3. Revise the ad valorem duty structure on oil imports.

4. Crack down on hoarding invoking the provisions of the Essential Commodities Act.

5. Strengthen Government intervention in procurement and distribution of essential commodities.

6. Reverse the dilution of the Essential Commodities Act and bring more items under its purview.

These steps, if initiated, would go a long way in checking the inflationary pressures that have built up.