'Ease inflation by targeting the agrarian sector'

New Delhi, July 29: Improving farm productivity, strengthening the agricultural extension system and making India 'One Common Market' by increasing the awareness among farmers about futures trading are the measures recommended by industry body FICCI to ease inflation.

The chamber suggested the measures to bring inflation at the desirable level, which is hovering close to the target of five per cent in this fiscal.

''Though the government is keeping a close eye on inflation, it is becoming difficult to curb the growing demand-supply imbalance in the agrarian sector,'' FICCI said.

It also said the private sector participation should be encouraged in developing agri-marketing infrastructure and in technology development and transfer.

Based on a feedback received from companies, the industry body said in its survey that the continuing pressure on prices of primary products is driven by the growing supply shortage in agri-commodity markets, which could be linked to the dismal growth of agriculture and grossly inefficient agriculture marketing infrastructure.

Moreover, a sustained phase of high growth for the last few years, which has translated into high consumption demand, has played a vital role in widening the supply-demand gap in the case of primary commodities further, the chamber claimed.

The rate of inflation as measured by the wholesale prices has risen to 4.41 per cent during the week ended July 14 from 4.27 per cent during the previous week.

The rise has been particularly marked in primary food articles -- fruits, vegetables, ragi, wheat, jowar, condiments and spices.

In the first quarter of this year, the rate of inflation peaked at 6.09 per cent during the week ended April 7. Thereafter, following certain steps, the Government calibrated imports, restricting exports to increase domestic availability.

Inflation then dipped to reach the lowest rate of 4.03 per cent during the week ended June 16. Since then inflation has been creeping upwards to 4.13 per cent for the week ended June 6.

UNI