Letters: The price factor

Cereals such as rice, wheat and coarse grains account for about 14 per cent of India's Consumer Price Index (CPI) basket. Once the "landmark" Food Security Bill becomes a law, the prices of these cereals will immediately drop by 90 per cent from their current rate of Rs 15-20 a kg to Rs 1-3 a kg. This 90 per cent drop will see CPI inflation come in at sub-3 per cent come February, after generously factoring in a Rs 4/litre increase in diesel prices until then. For those worried about the fiscal gap, ratings agencies may be placated by a few large divestments or large special dividends from public sector companies this year, including perhaps, the Reserve Bank of India. One should not write off the United Progressive Alliance's chances in the upcoming General Elections. It is not easy to rationalise that one family has ruled so many for so long. Yet, it has happened.

Rohan Soares Mumbai

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