Normal rains to help moderate food prices, PM

Manmohan SinghPrime Minister Manmohan Singh has said today that normal rains expected this year across the country will help moderate food prices in the country.

The prime Minister expects the food inflation to drop to about 6 per cent by December from about 10 per cent at present. The high food inflation and increased prices of auto fuel has angered a lot of political parties.

"We expect to see the rate of inflation in wholesale prices to come down to around 6 per cent by December", he said. Singh was addressing the crucial National Development Council (NDC). He voiced concerns over the lack of focus of states on agriculture sector which is important in keeping a check on inflation.

"This must be corrected if we want to achieve a broad based improvement in living standards in rural areas. Better agriculture performance is crucial for food security and would help in tackling the problem of inflation... present high rate of inflation is mainly due to food price inflation," He stressed.

Chief Ministers belonging to the opposition party present at the meet accused the centre of failing to control prices and said that the high prices has made life difficult for common man.

With the normal monsoon the pressure on food prices is expected to be eased by the second half of the year. In the last two years, the inadequate rains have cause high food inflation in the country.

The Prime Minister also asked Chief ministers to give their support in the implementation of the proposed Goods and Services Tax (GST) tax regime which will refresh central and state tax structure.

On Economic growth, he said that the growth is expected to be by 8.1 per cent annually during the Eleventh Plan period (2007- 12) making it the plan period with highest ever economic growth.