If the nuclear deal is attracting most of the limelight in present political scenario, skyrocketing inflation is not far behind from it. It is not only pinching the UPA government but also hurting ordinary public the most. If ‘nuclear deal’ is being the factor of ‘Power Testing’ in the Parliament, ‘inflation’ may be the real weapon for the oppositions in the next election fray.
Despite of several measures taken up by the Government and Reserve Bank of India, inflation is not willing to go down and instead soaring day by day. On the back of crude oil, food articles, food grains and metal prices, inflation has made all attempts of government blunt in reining the price rise.
The Wholesale Price Index (WPI), the index of 435 commodities today reported that inflation has surged consecutively 20 months and sustained the 11-year high record by touching 11.89% for the week ended on June 28 as against previous week’s reported data of 11.63%. The inflation data for the same week was on 4.42% a year ago.
The price has been reported high in several most important primary articles including food grains, food articles, manufacturing and non-manufacturing products and metal prices while the price of cement has been soften this week. The 10 years benchmark yield has crossed the 9.5% mark, while as per market experts, ‘the inflation data is expected to go to the 13 percent mark by the end of September.’
According to WPI data, the primary articles that rose by 0.9% on the back of ‘Food Articles’ group that rose by 0.5% and ‘Non-Food Articles’ group by 1.8%. In the ‘Food Articles’ group fruits & vegetables, masur and bajra each surged by 2%, while urad, arhar, jowar, barley and condiments & spices inflated by 1% each, whereas maize prices slid by 3%.
In the ‘Non-Food Articles’, the price increased as: castor seed (7%), linseed and sunflower (5% each), raw cotton, copra and mustard seed (4%each), tobacco (2 %) and groundnut seed (1%), while niger seed became 5% cheaper.
The ‘Manufactured Products’ group cumulative rose by 0.4%, in which ‘Food products’ group surged by 0.3%, ‘Textile’ by 2.5%, ‘Chemical and Chemical Products’ by 1.2%, ‘Non-Metallic Mineral Products’ by 0.8% and ‘Machinery and Machine Tools’ by 0.1% while ‘Basic Metals Alloys & Metal Products’ group declines by 0.8%.
In ‘Food Products’, the prices of coconut oil rose by 11%, rape & mustard oil by 5 %, soyabean oil by 4 %, gingerly oil and rice brand oil by 2 % each and khandsari by 1%. On the other hand, the prices of cottonseed oil declined by 2 %, imported edible oil by 1% and oil cakes by 1 %.
The prices of cement and metal declined due to strict steps taken by the government. The prices of basic pig iron and foundry pig iron slipped by 8 % each, steel sheets, plates & strips slid 6% each and other iron steel by 2%.
The Union Finance Minister P Chidambaram in this regard said in a statement that prices of essential commodities had almost stabilised and in few weeks, it would begin slowdown.
“In the primary articles group, out of the total 98 articles, 12 have shown a decline in prices as compared with previous week data. Another 55 articles have shown no increase in prices.” said Chidambaram in the statement.
Blaming the rising price of crude oil for this spiralling inflation, FM said, “It was basically price rise in petrol, diesel and LPG that had catapulted inflation to double digit number.”
The Prices of crude oil, which had touched the USD 146 mark per barrel a couple of week ago, has now slowed down and at present selling at USD 136 per barrel. The soaring prices of crude oil have forced the government to hike the prices of fuels, which had fueled the price rise.
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