Food Minister K V Thomas on Wednesday said the recent increase in diesel prices could some have a marginal impact on food prices, as much of the food commodities is transported through trucks, which run on diesel.
“The rise in diesel prices could have some impact on food prices as freight rates are expected to go up,” he told reporters on Wednesday. The minister said the government was taking steps to minimise the impact by increasing foodgrain allocations to families below and above the poverty line.
Last week, the government increased the diesel prices by Rs 3 a litre. Truckers and freight operators said this could lead to 8-9 per cent increase in freight rates.
On the overall food price situation, the minister said there had been general stability in prices, but “we need to constantly monitor the situation”.
“There has been some reports of increase in sugar prices after additional exports of 500,000 tonnes was allowed, but we have mechanisms to deal with it,” he said.
Earlier, this month, the government okayed an additional 500,000 tonnes of sugar exports. In April it has allowed export of 500,000 tonnes of sugar as production was more than consumption in 2010-2011 crop year that ends in September.