Pranab admits food inflation dangerous

New Delhi: Indian Finance Minister Pranab Mukherjee on Thursday expressed grave concern over rising food inflation, even as he attributed the latest spike in prices to increased demand during the festive season. Food inflation, at 12.21 per cent for the week ended October 22, climbed to a nine-month high.

"Food inflation is still going high. It is dangerously above double-digit figure," Mukherjee told reporters here. The Finance Minister, however, said the recent spike in prices of food items was due to increased demand during the ongoing festive season.

"The high food inflation is the effect of festive season demand. November onwards, the trend for remaining four months (of the fiscal) would be available," he said. Mukherjee also termed the price situation as a matter of "grave concern" as food inflation has been in double digits for three consecutive weeks.

According to the Wholesale Price Index (WPI) released by the Ministry of Commerce and Industry, the surge in food prices has been mainly due to expensive vegetables, pulses, fruits and milk, putting more burden on the common man. It was 11.43 per cent in the week ending October 15.

While food prices are going up, there has been some decline in non-food primary articles, Mukherjee said. Inflation in non-food articles, including fibres, oil seeds and minerals, was at 6.43 per cent in the reporting week as against 7.67 per cent a week earlier. On a weekly basis, inflation in the overall primary articles category stood at 12.08 per cent, compared to 11.75 per cent in the previous week.