Press Statement

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

Neoliberal Policies Responsible for High Inflation

The Wholesale Price Index has hit a thirteen-year high of 12.44%. Even this high rate does not reflect the actual burden on consumers in the continuing increase in retail prices of essential commodities. The CPI (M) expresses grave concern over this high inflation and the utter failure of the UPA Government to provide any relief. Compared to 2004, the retail price of wheat has gone up by over 60%, that of rice and pulses by nearly 50% and edible oil by over 40%. The higher procurement of wheat this year has had no impact on the wheat price in the open market.

In this context, the Prime Minister’s comments on price rise and inflation in his Independence Day address add salt to the wounds. He has cited the rise in international prices of food and fuel and claimed that the UPA Government has worked hard to ensure that inflation in India is not as high as in many other countries. While there are some developing countries like Venezuela, Egypt, Russia and Pakistan where very high inflation prevails, there are several other developing countries like China, South Korea, Brazil and Mexico where the inflation rate is lower than that of India. The Government can ill afford to seek solace in relatively higher inflation figures of some other developing countries.

The UPA Government has failed on its crucial commitment made in the NCMP to universalise the Public Distribution System. Instead it has chosen to slash foodgrains allocation to the States from the Central pool, causing difficulties for the State Governments. Doing away with the failed system of Targeted PDS and an expansion of an universalized PDS would have gone a long way in providing some relief to the working people, who are reeling under relentless price rise of essential commodities. Moreover, the prices of petrol and diesel have been increased seven times during the tenure of the UPA Government, which have also contributed to high inflation. The alternative proposals to cut excise duties on petro products have been largely ignored.

The CPI (M) reiterates its demands for the restoration of the foodgrains allocation to the States and increase in food subsidy to ensure universalisation of the PDS; ban on futures trading in essential commodities including sugar; and cuts in the central excise duties in petrol and diesel to bring down fuel prices. Instead of adopting such measures to provide relief to the common people, the UPA Government seems hell bent on pushing through the same neoliberal policies, which are responsible for the inflationary crisis being witnessed today.