Pinning hopes on high foodgrain production after good monsoon, Finance Minister Pranab Mukherjee today exuded confidence that inflation will come down soon and asked states to better the public distribution system to cater to the needs of the poor.
In an interview to a newschannel, Mukherjee indicated that the introduction of Goods and Services Tax (GST) may miss the deadline of April 2011 because consensus among states and the Centre is yet to be reached.
"So far the prices are concern which have already started coming down...And I do hope with the good impact of monsoon there will be more production of foodgrains... Ofcourse there are certain seasonal factors...I do hope it will come down soon," he said.
Food inflation advanced to 15.46 per cent in the week ended September 11, as prices of cereals, select vegetables and milk rose due to supply disruptions caused by unusually heavy rains in many parts of the country.
Week-on-week, food inflation climbed 0.36 percentage points from 15.10 per cent on September 4.
Further, the Finance Minister asked states to strengthen the public distribution system to make food available at affordable price, particularly for the people below the poverty line.
To a query over Food Security Bill, he said: "For unless the public distribution system is strong enough to deliver the quantum of food to this price range to the all over the country... This has to be done by state government in scheme of the constitution. It is their job... As a central government, there comes the question of cooperation of state government."
On growth of the economy this fiscal, Mukherjee said he projected the country's gross domestic product (GDP) to expand by 8.5 per cent.
"We have already projected that it would be 8.5 per cent, though international agencies like IMF they are projecting that it would be 9 percentage plus. In the first quarter of the current financial year it was 8.8 per cent. But still I am sticking to my old projection of 8.5 per cent," he said.
Mukherjee also said that the introduction of the new indirect tax regime, GST, may take more time.
"Time schedule will be changed. Because it needs consensus and constitution amendments. We are working on that. We have not reached consensus. It would take more time. As the way, we are interacting with state finance ministers and state governments, and also with various political parties. I do hope that it would be possible to reach a consensus," he said.
GST roll-out has already missed earlier deadline from the start of this fiscal.
