Time for govt to focus on non-food inflation, says Pronab Sen

Written by Press Trust of India | New Delhi | Updated: Jul 30 2010, 05:34am hrs
With food inflation coming down to a single-digit figure, the time has come for the government to focus on price rise of manufactured goods, said Planning Commission principal advisor Pronab Sen on Thursday. Its time to stop worrying about food inflation now as that seems to be coming down,and start worrying about non-food inflation, Sen said on the sidelines of a seminar organised by the Asian Development Bank on Thursday.

Sen said though the impact of the sharp decline in food inflation is likely to get reflected in the overall inflation rate also,the non-food categories will neutralise it somewhat. It is the non-food inflation which is now driving the wholesale price index. So, thats what on which we will have to keep our eyes open, Sen said. Food inflation fell sharply to 9.67% for the week ended July 17, from 12.67% in the previous week. Sen, who last month retired as the Chief Statistician, said the steep decline in food inflation is likely to continue for some time but it will not hit the bottom. The fall is expected but we should not expect that it is going to come down to 2-3%. That is not going to happen, he said, however, adding the softening food inflation will help in streamlining the monetary policy.