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Home > India > Business > PTI > Report

Retail food prices fall in Delhi, Mumbai

April 18, 2008 18:39 IST

The retail prices of essential food items have fallen by up to 11 per cent in Mumbai and Delhi in the first fortnight of April, much to the relief of millions in these metros who had to shell out 40 per cent more in the last one year.

The rates have come down within two weeks of government's price control measures, reversing the trend of spiralling prices.

A price analysis by PTI of the 14 essential commodities maintained with Ministry of Consumer Affairs show that prices of food items such as edible oil, vanaspati, potato and onion declined in Delhi, Mumbai and Chennai. However, Kolkata has no such relief.

The maximum fall is in edible oil prices that fell by over 11 per cent in the national capital, compared  to the 3-7 per cent drop in other commodities, the analysis has revealed.

The prices of mustard oil declined the maximum in Delhi by Rs 9 to Rs 71 from Rs 80 a kilo compared to other three metros where prices fell in the range of Rs 2-4 a kilo.

Ashok Gulati of International Food Policy Research Institute said the government can do much more to contain the rising prices.

"Taxation and market fee system need a major overhaul in reforming the state fiscal policies  by promoting direct purchases by retailers from farmers," Gulati told PTI. However, Crisil's DK Joshi said it is still early to say whether the government measures have worked or not.

"The government measures have moderated only the edible rates. I do not think it has done enough to bring down the prices of vegetables and pulses," Joshi said.

The government in the past 15 days have taken several steps to contain the rising prices, after inflation has soared over 7 per cent.

The steps included a ban on exports of non-basmati rice and extension of ban on pulses for another one year, besides slashing customs duty on all edible oils. The government also announced on Wednesday distribution of subsidised edible oil through public distribution system (PDS).

Commenting on these price control measures, Joshi said, the prices of edible oil may have come down but not to the extent the government wanted. "Well, the idea of selling edible oil via PDS may help prices to calm down further in the coming days," he added.

According to the price data, vanaspati prices fell by up to 6.41 per cent in three metros. They were down by Rs 5 at Rs 73 a kilogram in Delhi, by Rs 4 at Rs 70 a kilogram in Chennai and by Rs 3 at Rs 65 a kilogram in Mumbai.

Interestingly, the data showed a marginal decline in gram prices in Delhi only, while in Mumbai, Chennai and Kolkata, they remained unchanged. In eastern metropolis prices of all 14 items studied remained unchanged since March 31.

On pulses rates, experts said that the government could not control much because 50 per cent of domestic demand is met by imports. If the prices have to come down then it should increase the production in the country, they added.

Of 14 commodities analysed, prices of rice, wheat, atta, sugar, salt and milk remained unchanged in all four metros. However, politically sensitive items like onion and potato slipped in the range of Rs 1-3, it said.

The 14 items analysed are rice, wheat, atta (flour), sugar, salt milk, gram, groundnut oil, mustard oil, vanaspati, tea, potato and onion.

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