After three days of hectic consultations with Cabinet colleagues and experts, Prime Minister Manmohan Singh on Thursday set up an inter-ministerial group under the Chief Economic Adviser to the Finance Ministry to review the inflation situation with particular reference to primary food articles.
It will also assess international tariff trends and recommend action on the fiscal, monetary, production, marketing, distribution and infrastructure fronts to prevent “price spikes.”
As an immediate measure to curb inflation, import and export of all essential commodities will be reviewed “on a regular basis.” It will impose controls on exports and ease restrictions on imports, including tariff reduction wherever necessary, to improve domestic supplies. The ban on export of edible oils, pulses and non-basmati rice will remain.
Even as food inflation declined to 16.91 per cent for the week ended January 1 from 18.32 per cent in the previous week, official sources said the government was closely watching the situation and committed to containing the adverse impact of any inflationary pressure on the common man.