Will keep food inflation under check: PM

New Delhi, Aug 11 (PTI) As the spectre of drought loomed
large over key crop producing regions, Prime Minister of India
Manmohan Singh on Tuesday asserted that the government would
do everything possible to keep food inflation under control as
Union Finance Minister Pranab Mukherjee said there was no need
to panic.

The Prime Minister told businessmen, who called on him to
discuss the impact the drought may have on the economy, that
government godowns were brimming with food stocks and that
"everything possible" will be done to keep prices under check.

Already, 161 districts have been declared drought-prone
and Mukherjee said deficient rainfall will result in a 20 per
cent decline in sowing of summer crops.

He, however, said: "There is no point in pressing the
panic button. This country managed the century's worst drought
in 1987. We transported drinking water through railways. We
organised fodder for the cattle.

"This country has the experience of handling the
situation and I will advice not to press the panic button."

Central agencies like Food Corporation of India have
buffer stocks of over 50 million tonnes of rice and wheat and
Food Minister Sharad Pawar had earlier said the stocks were
enough to last 13 months.

"He (Prime Minister) was quite confident that given the
buffer stock, they (government) would be able to handle the
food inflation," Federation of Indian Chambers of Commerce and
Industry (FICCI) Secretary General Amit Mitra told reporters
after leading a delegation to Singh.

The meteorology department on Tuesday forecast this
season's monsoon to bring only 87 per cent of the usual rains.

Bihar is among the worst hit, with paddy sowing dropping
by 59 per cent to 15 lakh hectares against the targeted 35.50
lakh hectares.

State Agriculture Department Deputy Director (Statistics)
Sanjay Singh said rainfall was 42 per cent deficient at 331 mm
between June one and August seven.

The other major paddy producing region hit by the poor
monsoon is Haryana, where sowing could take place in only
10.88 lakh hectares against the target of 11.50 lakh hectares.
Significantly, Haryana had brought 12.10 lakh hectares in the
last kharif season.

Haryana has received only 94.9 mm of rainfall from June
one till August five, which is 61 per cent less than the
normal rainfall.

Fear of fall in output, given the drought forecast in a
fourth of the country, has led to surge in commodity prices.
Although Wholesale Price Index based inflation remains
negative, prices of essential commodities like pulses, sugar
and vegetables have skyrocketed in the past few months.

The Prime Minister informed the business leaders that the
government was gearing up the public distribution system (PDS)
to mitigate the impact of deficient rains. PTI AND
SDE
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