Prime Minister Manmohan Singh will convene a meeting of Chief Ministers by this month-end to seek their cooperation in curbing the high prices of essential commodities.
This was decided at a high-level meeting of the Cabinet Committee on Prices (CCP) that was chaired by the Prime Minister here on Wednesday. Several leaders expressed concern at the rising prices .
Checking hoarding
While the Uttar Pradesh government was singled out for imposing a ban on movement of imported raw sugar, the meeting largely agreed that the States should come down heavily on hoarders and speculators to augment the availability of essentials.
The State governments also need to lift the subsidised imported edible oil, pulses as well as the wheat and rice made available by the Centre for the open market. They need to check middlemen in the sale chain as the prices of wholesale produce were much lower than the retail prices.
‘Reduce taxes’
The Centre also requested the State governments to reduce the Value Added Tax (VAT) and other taxes on imported sugar as well as the high mandi taxes on food grain arrivals in “mandis.” High taxes on essentials were adding to the high prices of food items.
Announcing a slew of measures approved by the CCP to curb prices, Union Food and Agriculture Minister Sharad Pawar said that to increase sugar availability, duty-free imports of refined sugar was extended till December-end without any cap on quantities. The State governments were requested to remove the VAT and other taxes on imported sugar as done by the Delhi government. Sugar prices had shot up to Rs. 50 a kg in Delhi markets.
Major concession
At the same time, in a major concession, the government decided to waive off the excise duty for processing raw sugar imported by Uttar Pradesh mills in other States. “This will make available the about nine lakh tonnes of imported raw sugar that is lying at the Kandla and Mundra ports. With this sugar in hand, after processing, the availability of sugar will improve and the prices will come down within a month.”
Mr. Pawar said sugar availability at the end of the season would be about 241 lakh tonnes, against the demand of 230 lakh tonnes. “According to the latest information, the ex-factory price of sugar in Maharashtra will come down to Rs. 32 a kg in a week and is likely to be lower in Uttar Pradesh and southern States.”
More wheat, rice
To augment supplies of wheat and rice, the government has decided to additionally make available to the States up to five lakh tonnes of wheat and two lakh tonnes of rice at rates that would be equal to the minimum support price for the farm produce plus freight.
