Food inflation is hovering at an uncomfortable trajectory and has increased at high double digits level at 18.40% in September 2013. At this juncture, government should remove the supply chain bottlenecks since we have enough agricultural production to serve food demand in the economy but the delivery from the farm gate to consumer doorstep is problematic in terms of various hurdles in the supply chain management, said Mr. Khaitan.
Government at this point of time needs to act effectively to improve and fasten the supply chain process to prevent jump in prices of various commodities especially the food items which causes cascading impact on the overall WPI inflation scenario, says Mr. Khaitan.
The IIP has been witnessing sharp fluctuations since April 2013 as growth in IIP was recorded at 1.5% which decelerated to -2.5%. In the month of June 2013, the growth in IIP was recorded at -1.8% which increased to 2.8% in July 2013 and finally decelerated to 0.6% in August 2013. We believe, to revive the industrial growth prospects, government should cut the policy rates. Rate cut will be inevitable to facilitate industrial production process and to gain in the international markets by enhancing exports scenario further. It will not only contain current account deficit (CAD) but also help rupee to stabilize with fiscal consolidation through increased revenue earnings of the government.
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