March 18, 2011

India's food inflation shrinks as agricultural product prices fall

India's yearly food inflation rate lowered to 9.42% for the week ended March 5 from 9.52% the earlier week, as vegetable, milk, egg, meat and poultry prices fell, official data showed Thursday (Mar 17).

Limited data on the wholesale price index released by the commerce and industry ministry showed that the index for primary articles also fell from 13.96% to 12.31%, while that for fuel increased to 12.79% from 9.48%.

India's inflation rate continues to remain sharply higher than the comfort zone of both the Reserve Bank of India's 4-5% and the government, which earlier said the prices will be reined in to no more than 5%.

Prime Minister Manmohan Singh had told the Lok Sabha that food prices will come down in the near term and that overall inflation will be no more than 7% by March-end. "By the end of this fiscal year, inflation will be controlled. I expect the situation to improve," he had said.

Following are the yearly rise and fall in prices of some main commodities that form the sub-index for food articles: milk-7.16%, eggs, meat, fish-13.10%, cereals-3.38%, rice-2.75%, wheat-0.69%.