How Narendra Modi plans to tackle inflation: 7 top points

May 19 2014, 10:20 IST
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Ministerial-level coordination mechanism at the national/ regional level Ministerial-level coordination mechanism at the national/ regional level
SummaryThe BJP’s hard stand against FDI in multi-brand retail notwithstanding...

In the run-up to the elections, the BJP top brass maintained that the problem of spiraling inflation is specifically on account of supply-side bottlenecks and that raising interest rates, while being ineffective in tackling core inflation (non-food, non-fuel inflation), only served to dampen a demand-led recovery. The BJP’s hard stand against FDI in multi-brand retail notwithstanding, the recommendations include fostering competition by way of promoting retailing through the “organised sector and cooperatives”.

Key points

* Ministerial-level coordination mechanism at the national/ regional level

* Priority sector lending to agri-marketing activities

* APMC Act reform across the country, liberalisation of agri markets

* Time-bound development of agri marketing infra — storage capacities in food deficit regions, cold chain, agro-processing

* Unbundling of FCI operations of procurement, storage and distribution

* Increase competition by promoting retailing by organised sector and cooperatives

* Setting up a price stabilisation fund

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