Reeling under the twin Assembly poll setbacks, Congress on Saturday admitted that anti-incumbency against sitting legislators and to a certain extent the Centre's failure to rein in price rise led to its downfall in Punjab and Uttarakhand.

Party general secretary Digvijay Singh said inflation was definitely a matter of concern for the party and sought to put the onus of bringing down prices on the state governments as well.

"Anti-incumbency is a major factor in Indian politics today. Not only against the governments, but there is anti-incumbency against incumbent legislators as well," he said in an interview on CNN-IBN's Devil's Advocate programme.

In urban areas of Punjab the party "could not change the candidates," Singh said and made a candid admission that in certain constituencies the party got it wrong in selecting its nominees.

"Selection of candidates is always a very tricky and very difficult issue," he said adding, that Congress was not at all threatened by the verdict and exuded confidence that it will retain power at the Centre in 2009.

Asked whether the Manmohan Singh government's failure to tackle inflation was a reason for Congress defeat, he said "to some extent maybe yes" but quickly added that the Centre was taking all measures to check price rise.

Defending the Union government, he said price rise was not a new phenomenon and it was there during the National Democratic Alliance government's regime as well when the inflation graph had remained over eight per cent for several weeks.