Even as the government is in the process of devising various ways and means of getting a hold on the price spiral, the World Bank on Friday attributed the inflationary pressures to supply bottlenecks and assured support to improve farm productivity which will help stabilise food prices.
Responding to a query on high food inflation at a joint press conference with Finance Minister Pranab Mukherjee, World Bank President Robert B. Zoellick said: “My own sense in the case of the Indian economy is that some of the inflationary pressures are more likely a function of some of the bottleneck[s] on the supply side than they are from the demand side”.
The World Bank, he said, would try to help India in overcoming the obstacles in the way of improved farm productivity and production. “This will be very key priority over the next three years,” he said.
On his part, responding to a query on the level of utilisation of World Bank assistance, Mr. Mukherjee said: “I am not fully satisfied. But surely myself and my colleagues are trying to see that the rate of utilisation is very high and there has been a steady progress in the rate of utilisation”.
As of June 30, 2010, the World Bank group had 75 active projects in the country. The net aid commitment for these projects was about $21.4 billion. Fresh lending in 2009-10 (July 1, 2009 to June 30, 2010) amounted to $9.3 billion.
