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Rediff.com  » Business » PM defends Pawar over price rise issue

PM defends Pawar over price rise issue

February 07, 2010 16:28 IST

Virtually cocking a snook at the Congress Working Committee which had criticised Union Agriculture Minister Sharad Pawar failing to control the price rise, Prime Minister Dr. Manmohan Singh praised the Pawar for doing a splendid job. The praise came just a day after the CWC meeting, when the prime minister addressed the chief ministers during a conclave on price rise.

The meeting on price rise decided to constitute a committee which would monitor prices and the food supply in the country. The PM's penchant for setting up committees and Groups of Ministers is well known even as the one day meeting could throw up no new suggestions on how the spiraling price rise could be contained except for the PM saying that the worst of
the food inflation was over.

The committee will be headed by the prime minister, it would include Sharad Pawar, Pranab Mukherjee and Montek Singh Ahluwalia along with the chief ministers of 10 states.

Interestingly the bulk of the states selected are opposition ruled, namely Punjab, Bihar, Gujarat, Chattisgarh, Madhya Pradesh and West Bengal, three are congress ruled--Andhra Pradesh, Assam and Haryana--Tamil Nadu is ruled by United Progressive Alliance ally, the Dravida Munnetra Kazhagam.

A senior minister said that in the wake of growing criticism about Sharad Pawar's portfolio where he is himself the consumer and the producer it was felt that the committee could offer overall supervision on the food situation and create a mechanism whereby the actions of the minister and the ministry could be monitored.

But the question being asked is that Pawar has held the agriculture portfolio for the last six years which includes the first five years in UPA-I. During the second innings, the entire cast of portfolios were repeated with minor changes, so did the prime minister not apply his mind to the situation earlier and is the government now only acting because the pressure is becoming too much to bear.

With the meeting virtually turning into a centre versus state confrontation, Finance Minister Pranab Mukherjee scolded Gujarat Chief Minister Narender Modi three times during the course of the discussions asking him not to play politics on the issue.

Modi squarely blamed the centre for the current food crisis and inflation saying that the government had no concrete plan to handle the situation. Modi wanted to know why the government had decided to export sugar when the price of sugar was low in the country and why it decided to import sugar when the sugar prices were high abroad. He also wanted to know why the government had not implemented its election promise of providing rice to BPL families at Rs 3 per kilo.

Modi said that the centre's attribution of price rise to "adverse" weather conditions, was not correct, contending that cost of essential commodities were contained when similar climatic conditions prevailed between 2000--2002.

"I am surprised to learn that the has attributed price rise to 'adverse' weather and climate change," Modi told the conference.

He contended that "more adverse climatic conditions" had prevailed for three years between 2000-2002 which had an similarly adverse effect on agricultural production. Yet, the food inflation was contained within five per cent through better supply side management," he said.

The Bharatiya Janata Party-led National Democratic Alliance was in power at the centre from 1998 to 2004. Modi also sought to reject the Centre's argument that hike in minimum support price had led to rising prices.

"If the rise in Minimum Support Price of paddy has been 16 per cent and about 50 per cent in the statutory support price of sugarcane during 2009-10, we are unable to appreciate the economic logic behind 40-60 per cent rise in the prices of food grains and more than 150 per cent rise in the prices of sugar," he said.

Modi contended that the food price inflation shown by the wholesale price index was not the correct measurement of the price situation faced by a consumer as the common man paid much higher price than the wholesaler.

The prime minister on his part pushed much of the blame on the states asking them to be tough on hoarders and blackmarketers and contending that the centre was doing everything possible to contain the situation.

Like in the CWC, the previous day where nothing substantial emerged, the conclave of CMs was also an exercise in blame game though a committee did emerge out of the entire process. Maybe the prime minister is tired of answering questions on price rise, though he has still not found the heart to blame Pawar, as his own party has been doing

Renu Mittal in New Delhi