FM warns industry of strong measures

  
Finance Minister P Chidambaram today warned of "strong measures" if some sectors behave "irresponsibly" to moderate prices. He said inflation is the "biggest worry" and the government would not hesitate to take more fiscal measures even at the cost of sacrificing some badly needed revenues.

"We have taken fiscal measures... We will not hesitate to take more fiscal measures even if it means sacrificing some revenues that are badly needed for social sector expenditure," the finance minister told PTI in an interview.

Chidambaram, who is in Washington for an IMF-World Bank meeting, said the issue of inflation raised by the Fund as it pertained to India is indeed a "very serious" concern.

Describing inflation as "the current biggest worry", he said: "There could be unexpected political developments and there could be natural calamities. All other factors today, I think, are positive." The RBI, the finance minister said, is the authority responsible for monetary measures, "and I am sure RBI will take appropriate monetary measures. The third leg of the triangle is the supply side. But supply side responses are not immediate. Supply side responses to a situation of high demand and shortages can only come in the medium term." He warned: "A number of steps have been taken and a number of steps will be taken to enhance supply, especially supply of food items. If after all these some sectors behave irresponsibly, then the government would have to consider strong measures in order to moderate prices."