Montek Singh Ahluwalia

Govt cracks the price whip, finally
Statesman News Service

KOLKATA/NEW DELHI, 22 DEC: Food prices in the country will come down from January 2010, Mr Montek Singh Ahluwalia, deputy chairman of the Planning Commission, said today.
The statement came as agriculture minister Mr Sharad Pawar said the government has reduced prices of wheat earmarked
for sale to retail consumers by nearly
Rs 200 a quintal to rein in runaway food inflation.
Mr Ahluwalia (in file photograph), speaking at the National Conference on Leadership organised by the Confederation of Indian Industry in Kolkata, said the food prices situation pointed to a faulty distribution system, as the rise in retail price of foodgrains has been higher compared to wholesale price.
Food inflation last week touched a 10-year-high of 19.95 per cent. The prices of pulses, wheat and rice ~ and vegetables like potatoes and onions ~ have risen sharply.
Mr Ahluwalia said that the present price rise was a result of speculation because of drought in the country. Although the drought did affect agriculture productivity, the stock position was adequate. However, speculation pushed up the food prices.
"Stocks of cereals are adequate and prices can be moderated and it will be from January,” he said.
Pointing out that food inflation was not the same as inflation, Mr Ahluwalia added that a solution to the hike in food prices does not lie in "blunt monetary measures".
He said importing food grains was also not a solution. If the government imported foodgrains, it would have to do so at a higher price. This meant that in order to make them available in the domestic market the government would have to provide them at a subsidized rate. In such a situation farmers would then say that they were being deprived of the market price for their produce. “A very critical balancing act has to be maintained but we will see a decline in food prices,” he said.
In New Delhi, food and agriculture minister Mr Sharad Pawar told reporters that wheat price (under Open Market Sale Scheme) has been reduced by nearly Rs 200 a quintal from the price fixed earlier.
Asked if the price cut applies to both states as well as bulk consumers, the agriculture minister said it has been done only for retail consumers.
Earlier, the Centre had decided to sell wheat to the states at the minimum support price of Rs 1,100 per quintal, plus transport cost. Under the scheme, the Centre had allocated to the states 10 lakh tonnes of wheat each during October-December and January-March for distribution to retail consumers. The scheme, however, did not receive good response and the offtake by the state governments has been quite low. There have been demands from states for supply of wheat at the BPL rate (Rs 4.15 a kg).
Labour laws restrictive
Labour laws of the country are unduly restrictive, Mr Montek Singh Ahluwalia, said today. Suggesting that there was need to change the labour laws of the country, he said that investors were not ready to have a huge labour force. “Most of the people do not understand that this could be a major constraint," he said. Pointing out that there was a need to involve the labour unions in discussions on making changes in labour laws, he said: "We are failing to convince them (unions) that the laws are favourable to them. We need to do more work on them.”


I would like to congratulate Mr. Ahluwalia on discovering and announcing that the prices would fall in January.
You don't have to be Dy. Chairman of the Planning Commission to know that.
This is known to everybody, just for his information.
Vegetable prices fall during this time of the year.
Further new grains come to the market so naturally prices fall.
It is not because of any effort of the government.
And the opposition which is shouting so hoarse of price rise should know that they are partly responsible.
When the government tries to control the price of sugar by fixing a price, the opposition raids Delhi with farmers and force it to raise prices of cane.
Now, if cane prices are high, naturally sugar prices too will be high also.
Area under cultivation is going down because of land being given to industrialist for SEZ, so where is the food grain to grow.
We flood the market with liquidity to give a boost to industry.
That liquidity then chases scarce commodity and supply and demand states that prices are bound to increase.
We do not check our population for fear of antagonising the minority community knowing that the more mouths there are to feed, the more the prices will rise.
We do everything to raise the prices and then blame everybody else except ourselves.
The congress blames the government where it is in the opposition and the BJP, CPM, SP. BSP blames the Congress at the centre.
Our country has virtually become a tower of Bable.
Events taking place in Parliament just prove it.
What can you expect when you have corrupt politicians who are just interested in padding their own nests, lead the country.