New Delhi: With high inflation being blamed for the defeat of the Congress in assembly elections, the government today said containing spiralling prices was among the top priorities on its agenda, while the Reserve Bank too made it clear that efforts on this front would continue.
Apparently admitting that the price rise was one of the reasons for the Congress defeat in the recent elections, Finance Minister P Chidambaram said it was common knowledge that the government of the day pays the price for persistently high inflation.
Inaugurating the Delhi Economic Conclave, the minister said along with fiscal consolidation, the government would focus on inflation management.
“At the top of the list is fiscal consolidation...Next on the list is tackling inflation,” he said. Chidambaram blamed state governments for “inaction” in tackling hoarding, saying the current high inflation, measured by the consumer price index or the wholesale price index, is driven by food prices, especially of fruits, vegetables, meat, fish, eggs and milk.
Later, speaking at the same venue, RBI Governor Raghuram Rajan, who has raised a key interest rate twice since taking over in September, said the level of inflation in India is one of the highest among the world's large countries.
“No single data or point or number will determine our next move but our effort is firmly on controlling inflation,” Rajan said ahead of his next monetary policy announcement on December 18.
Wholesale price inflation was at an eight-month high of 7 per cent in October, while retail inflation crossed 10 per cent.
CPI inflation data for November is scheduled to be announced tomorrow while WPI inflation numbers are to be released on Monday.
Rajan has hiked the key policy rate (repo rate) by 0.25 per cent in each of the two polices he announced.
The Congress lost the assembly elections in Delhi, Madhya Pradesh, Rajasthan and Chhattisgarh. Party President Sonia Gandhi referred to price rise as one of the factors for the defeat.
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