Reserve Bank of India (RBI) Governor D. Subba Rao Wednesday expressed concern over the food price inflation in the country, saying that it could fuel “inflationary expectations”.
“If food price inflation persists for long, they can fuel inflationary expectations and the monetary policy will have to take a view on this,” Mr. Rao told reporters at the state secretariat Writers’ Buildings.
Apart from the escalating Food Price Index (FPI), Mr. Rao said the Wholesale Price Index (WPI) was “modest” and the Consumer Price Index (CPI) “quite high”.
He met West Bengal Chief Minister Buddhadeb Bhattacharjee and state Finance Minister Asim Dasgupta on the eve of RBI’s central board of directors’ meeting here.
Dasgupta said the government discussed the credit requirements of self-groups, farmers, small scale industries and financial inclusiveness with Rao.
He lamented that there were no bank branches in 334 gram ‘panchayats’ (rural bodies) areas, while more than 200,000 self-help groups in the state had not got bank loans.