PM asks states to consider waiving mandi, local taxes

New Delhi, Feb 4 (PTI) Prime Minister Manmohan Singhtoday asked states to consider waiving mandi, octroi and localtaxes for taming inflation which affects poor "harder" andposes serious threat to the country''s growth momentum.

He said much of the responsibility for checking pricerise lies with the states.

"Much of what needs to be done ....lies in the domain ofstate governments... There seems to be a strong case forwaiving mandi taxes, octroi and local taxes, which impede thesmooth movement of essential commodities," Singh saidaddressing chief secretaries of states here.

Stressing on the need for a paradigm shift in theinstitutional arrangements, he pressed the states forreviewing functioning of the Agricultural Produce MarketCommittee Acts (APMCAs) On "an urgent basis".

Underscoring the role of super stores, the Prime Ministersaid the storage facilities have to be augmented and "supplychains need to be dovetailed with the organised retails forquicker and more efficient distribution of farm products".

Driven by high prices of fruits, milk, meat, eggs,India''s food inflation crossed 17 per cent for the week-endedJanuary 22.

While the Indian economy is projected to grow by 8.8-9.0per cent this fiscal, inflationary concerns are looming overthe growth prospects.

However,the Prime Minister partly attributed the rise inprices of "superior food products" to rising income level and"corollary of faster growth ".

Singh said the lasting solution for price inflation liesin increasing agricultural productivity and production notonly of cereals but also of pulses, oilseeds, vegetables andfruits and augmenting the supply of milk and milk products,poultry, meat and fish.

He said while the Centre would provide support forchecking inflation.

"Each state has to work out a suitable plan of actionsuited to its requirements and its capabilities."

He said though various social sector programmes for theempowerment of the poor and the disadvantaged have met withreasonable success, "there is a perception that the schemes donot provide the intended benefits to them in full measure onaccount of leakages and at times tardy implementation."

Singh also asked the Chief Secretaries to explore waysand means by which the infrastructure deficit in the statescould be bridged.

"While we have made some progress in the last six-and-a-half years in improving our infrastructure and tried newmodels like the Public Private Partnership, much more needs tobe done and it has to be done on a priority basis," he said.