Food prices rose nearly 19 percent annually in the first week of December. Food prices have been surging after the driest spell in nearly four decades and flooding in some parts of the country hurt crops and pushed up food prices. Finance Minister Mr.Pranab Mukherjee agreed that rising food prices is a cause for concern and suggested the best approach is to augment supply through imports.
The Government ruled out importing rice this year, saying it had comfortable stock position even after factoring strategic reserve requirements. Food and Agriculture Minister Sharad Pawar said discounting the need for imports although rice production is expected to dip by 13 million tonnes this year. According to the norm, the Centre should have 118 lakh tonnes of rice as on January 1st every year. The current stock level is around 229 lakh tonnes of rice as on December 1st 2009.
Deputy Head of India’s planning commission, Montek Singh Ahluwalia, said that the rise in food prices is excessive but there will be a decline in January. He further explained that the current situation is due to the drought situation and the stock situation is relatively fine.
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