No easy answers to high retail inflation: Chidambaram

Chidambaram said his foremost priority would be to contain fiscal deficit and Current Account Deficit

As retail inflation crossed the double-digit mark, Finance Minister P Chidambaram on Thursday said the government was looking at various suggestions to cool prices but there were no easy answers to the problem.  

“Both RBI (Reserve Bank of India) and the government are trying a number of measures to cool inflation... We are looking at various suggestions that we have got. I am open to suggestions but I am afraid there are no easy answers to cool retail inflation," he said while addressing investors here.

He attributed rising inflation to the high fiscal deficit incurred by the government to neutralise the impact of global financial meltdown of 2008. He further said although the government had offloaded 500,000 tonnes of wheat to contain price rise, it would not cool prices of fruit, vegetable, milk and eggs.      

Chidambaram said his foremost priority would be to contain the fiscal and current account deficits (CADs). The fiscal deficit in the current financial year, he added, would be brought down to 4.8 per cent of the gross domestic product (GDP)from 4.9 per cent in 2012-13.

With regard to CAD, the minister said he would endeavour to bring it down to below $56 billion, a figure which was given by RBI Governor Raghuram Rajan on Wednesday.