PM calls for strengthening retail to help fight inflation

With Budget 2011-12 barely weeks away, Prime Minister Manmohan Singh today outlined the government’s intention to strengthen the retail sector to temper soaring food inflation.

“There is a need for a paradigm shift in our institutional arrangements for improving the availability of various commodities to meet the higher levels of domestic consumption,” he said, while inaugurating the second annual conference of state chief secretaries in the capital.

“Supply chains need to be strengthened, and these need to be dovetailed with organised retail chains for quicker and more efficient distribution of farm products and more remunerative prices for our farmers,” the PM added.

He also pointed out that since the government had no control over the price of imported goods, its ability to stabilise inflation depended crucially on controlling the price of non-traded goods and services, adding that much of what needed to be done in this regard was in the state governments’ domain.

Urging states to take the necessary action to improve the situation, the PM said, “Functioning of the Agricultural Produce Market Committee Acts needs to be reviewed on an urgent basis and there seems to be a strong case for waving mandi taxes, octroi and local taxes, which impede the smooth movement of essential commodities.”

Apart from taming inflation, the Prime Minister made it clear that weeding out corruption at all levels topped his agenda. “This is a challenge, which has to be faced frontally, boldly and quickly,” he told the chief secretaries. He underlined the need to fast-track the revamp of administrative practices and procedures and quickly put in place a systemic response that reduced opportunities for corruption.

“Corruption strikes at the roots of good governance. It is an impediment to faster growth. It dilutes, if not negates, our efforts at social inclusion and it dents our international image and it demeans us before our own people,” he said.