Attributing the rise in inflation partly to withholding of food stocks by traders, Finance Minister Arun Jaitley, on Monday, said the Centre was committed to ease supply side bottlenecks, and had also asked States to take firm measures against hoarders to check speculation.
“The government is seized of the matter, and is committed to ease supply side constraints. The rise in prices of food articles can also be attributed to withholding of stocks on account of apprehension of a weak monsoon,” he said.
He was commenting on the Wholesale Price Index (WPI) data, which showed that inflation jumped to five-month high of 6.01 per cent in May primarily on account of costlier food articles, fuel and power costs.
The Union Finance Minister said the State governments should take effective steps to ensure that hoarding was discouraged.
“The Government is committed to take measures, which will positively impact the GDP and result in higher growth than expected. I am hopeful that the inflation, which is moving upwards now, would eventually come down,” Mr. Jaitley said.
Referring to the rupee slide against the dollar, he said the government was watching the movement of the domestic currency closely.
“The slight instability of the rupee is essentially because of Iraq oil shocks and global fear of oil price rise,” he said.