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| Food inflation a concern in India: UN agency |
| Press Trust of India / New Delhi May 06, 2010, 13:30 IST |
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A United Nations expert body today said surge in food prices in India is a matter of concern, but retail price inflation will cool down to 7.5 per cent this year from around 12 per cent last year.
The UN Economic Social Commission for Asia and Pacific (ESCAP) also projected the economy to grow by 8.3 per cent in 2010-11, compared to estimated 7.2 per cent last fiscal, fueled by the recovery in investment and private consumption.
"In India, consumer prices, particularly of food, remained stubbornly high and the consumer price index (for industrial workers) rose to about 9 per cent in 2008. Inflationary pressure continued into 2009, largely resulting from the poor monsoon which had an adverse impact on food supplies, firming up of global commodity prices and the govt's expansionary fiscal stance," UN ESCAP said.
In its report on 'Economic and social survey of Asia and the Pacific 2010, the UN body said inflation as measured by the consumer price index was around 12 per cent in 2009 and a faster increase in food prices has become a cause of concern.
There are a number of indices for consumer price inflation and CPI (IW) refers to items consumed by industrial workers.
The wholesale price-based food inflation had crossed 20 per cent in December last year, but has been falling of late with the arrival of rabi crop and was at 16.04 per cent in the third week of April this year.
On growth, ESCAP said, "With a revival in investment and private consumption, growth in exports and a strong expansion in industrial production in recent months, growth in GDP is projected to accelerate to 8.3 per cent in 2010."
The UN body said the structural growth impulses of the economy remain strong in India, given the high domestic savings rate, sound financial system and the macro economic policy environment supportive of growth.
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