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Now, government can do little to curb food inflation: KV Thomas

KV Thomas is worried about the climbing food inflation. He says int'l demand-supply situation & rising crude prices make it tough to rein it in.

, ET Bureau|
Updated: Jul 04, 2012, 11.49 AM IST
Union Food and Consumer Affairs Minister KV Thomas is worried about the climbing food inflation. But international demand-supply situation and rising crude prices make it tough to rein it in, says the minister in an interview with ET. Excerpts:

There's a fear of below normal monsoon this year. But we have opened up our farm exports including key commodities like sugar, wheat and rice.

We have ample stocks of foodgrain and sugar. The global market is also warming up to make it an opportune time for us to export. However, we should tread cautiously on export front. Our priority is to meet the requirements of our people.

A lot has been written about record production and availability of foodgrain. But prices are still soaring. What are you doing to rein in food inflation?

Frankly speaking, we can do little about it. The agri-input cost has increased. We have to give higher minimum support prices (MSP) to farmers. Moreover, food inflation is governed by several external factors, which we can't control. Higher global crude prices stoke inflation.

So far, monsoon has been weak. Is food ministry ready to ensure uninterrupted supply of grains across the country?

We have ample foodgrain in our godowns. There's no worry on that front. We have a robust PDS, which has become more transparent after computerisation. We will take it up as a top priority if state governments demand extra grain allocation.

How will you ensure availability of pulses if output is not up to the expectation?

We expect the monsoon to be good. Agriculture department is promoting pulses' production. It has increased the MSP and launched special drive to improve pulses production. However, if output is low, we will import pulses.

It's been over six month since the C Rangarajan committee was constituted to examine de-regulation of sugar sector. What is its status?

The committee has so far held two meetings. The ministry officials are preparing chapter-wise detail of the issues discussed in the meetings. Once this is documented, the committee will take it up further. There's no time line as of now.

Is there a possibility of lowering levy obligation on sugar mills?

We are considering the issue of lowering the levy obligation. I have discussed this issue with Agriculture Minister Sharad Pawar. He has given some suggestions. However, we are yet to finalise on this.

Forward Market Commission (FMC) has come up with a report, examining reasons behind the extraordinary surge in guar seeds and guar gum prices. Have you taken any action on that?

The ministry is analysing the report. We will take action only after the complete analysis. We have suggested FMC to constitute a committee, involving all stakeholders, to keep a close watch on the price behaviour. FMC is an autonomous body. We can't regulate it.

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