The three-year low in wholesale price inflation in January (6.62 per cent versus 7.2 per cent in December) is welcome, but it will get really meaningful when food prices and the consumer price index (CPI) fall from their present double-digit growth. The CPI, which affects all those who buy retail from the markets, is at 10.8 per cent, and is the highest among Bric nations — Brazil, Russia, India and China — and the emerging economies of Southeast Asia. Food prices, from vegetables and fruits to protein items, are also extremely high, and it is disturbing that a country that is the largest producer of fruits and vegetables is unable to meet the rising demand.
The agriculture and food and civil supplies ministries must be made accountable for this short supply, and unless the ministers are themselves made accountable, nothing much can be expected. The Reserve Bank of India, which monitors inflation closely, has always maintained that rising food inflation is a supply side problem and cannot be dealt with through monetary measures.
It is not as if the demand for food and protein items has grown overnight, so there’s simply no excuse for not taking steps to increase the supply of these items. Protein products, for instance, don’t depend on favourable weather! We have technology available today to grow even rice with little water. It requires care, administrative efficiency and out-of-the-box thinking to resolve this issue of declining per capita availability of vegetables, fruits and protein-based items.