The Hindu Business Line : Ministry, RBI to jointly tackle inflation, says Chidambaram

THE Finance Minister, Mr P. Chidambaram, has said that the Ministry of Finance and the Reserve Bank of India would take concerted action to control the spiralling inflation that reached 7.51 per cent last week.

"Action can be taken in a measured manner both on the monetary and fiscal side. While the RBI will take action according to its judgment on the monetary side, the Ministry of Finance will look at options on the fiscal side," Mr Chidambaram said after a meeting of the Cabinet Committee on Economic Affairs (CCEA) today.

While stating that the issue of inflation did not figure in the CCEA deliberations, Mr Chidambaram said that he has had meetings with the Prime Minister, Dr Manmohan Singh, and the RBI Governor, Dr Y.V. Reddy, on measures to control the situation. While his meeting with the Prime Minister was held last night, the Finance Minister held a meeting with Dr Reddy on Tuesday.

MSP for paddy hiked: The Government today announced a Rs 10 per quintal hike in the minimum support price (MSP) of the current year's paddy crop to be procured during the forthcoming kharif marketing season, beginning October.

The MSP for common grade paddy has been raised to Rs 560 per quintal from Rs 550 for the 2003-04 crop, while the same for Grade `A' paddy has been correspondingly enhanced from Rs 580 to Rs 590.

The Cabinet Committee on Economic Affairs also decided to increase the MSPs of bajra, jowar and ragi by Rs 10 (from Rs 505 to Rs 515), even as that for maize was raised by Rs 20 (from Rs 505 to Rs 525).

The maximum increase has, however, been announced for oilseeds and pulses.

The MSP for yellow soyabean has been fixed at Rs 1,000 per quintal (up from Rs 930 for the 2003-04 season), and at Rs 900 (Rs 840) for black soyabean, Rs 1,500 (Rs 1,400) for groundnut-in-shell, Rs 1,500 (Rs 1,485) for sesamum and Rs 1,180 (Rs 1,155) for nigerseed.

In the case of pulses, the MSP has been hiked from Rs 1,360 to Rs 1,390 for arhar (tur) and from Rs 1,370 to Rs 1,410 for moong.

For cotton (kapas), the MSP has been increased from Rs 1,725 to Rs 1,760 for F-414/H-777 varieties and from Rs 1,925 to Rs 1,960 for the H-4 variety.