IMD appraises PMO that despite delay, rainfall set to improve in July.

NEW DELHI: The government sternly warned traders against hoarding, declared that agricultural markets were well supplied, and said monsoon rainfall would improve significantly next month, as it stepped up its efforts to combat food inflation.

Prime Minister Narendra Modi reviewed the tardy progress of the monsoon, which is about 40% below average this month. A statement from the prime minister's office said Modi also reviewed steps to contain inflation.

"It was observed that the measures are having a positive effect, with adequate rice stocks reaching markets. There is now no shortage of onion stocks in Delhi. The Prime Minister said states should set up special courts for speedy trial of hoarders and black-marketeers."

Modi had called weather officials, the cabinet secretary and ministers for home, finance, agriculture, food and water resources for the review meeting.

After the meeting, Food,Consumer Affairs and Public Distribution Minister Ram Vilas Paswan lashed out at of traders who he said had needlessly created panic in the market.

"There is betting happening on inflation. Black-marketers, hoarders and trading cartels are creating unnecessary panic about shortage of food grains and vegetables," said Paswan. The government also announced a minimum export price of $450 per tonne on export of potatoes.

We are hopeful that there would be enough domestic supply of potato and less production happening due to weak monsoon are just speculations as of now," said Paswan. The government is concerned about the tardy progress of monsoon rainfall this month, which is crucial for planting of crops. The monsoon has not progressed for the past 12 days but a PMO statement said the situation was likely to improve.

"Officials from the India Meteorological Department ( IMD) apprised the Prime Minister of the monsoon situation. They said that though the monsoon has been delayed, rainfall is likely to improve substantially in the months of July and August. The Prime Minister also reviewed the position of water reservoirs and fodder stock. He directed that maximum possible use be made of the existing water resources, and best practices in rainwater harvesting," the statement said.

The agriculture ministry has prepared a contingency plan for more than 500 districts. The Prime Minister also emphasized on ensuring adequate power and seed availability for the agricultural sector, and directed that NREGA be used to generate rural employment, if necessary.

Paswan minister blamed the hoarders for the recent increase in the price of onion, potato and sugar.

"There is no shortage of onion, still the price shot up just because of market rumours. Same happened with sugar. We announced financial relief package for the mills to pay the cane farmers but that was translated into price hike," said Paswan.

Food ministry, announced this week, bailout package for the sugar industry which included Rs4,400 crore interest free loan, hike in import duty, exemption on export worth Rs3,330 per tonne and increase in ethanol blending to 10% from 5%.

"It is for the benefit of the farmers that we de-listed fruits and vegetables from the APMC regime. Inflation is our top priority and our measures are aimed at taming it," said Paswan.

Assuring that there would not be any scarcity of food grains in the country, irrespective of the state of monsoon, Paswan said, "When the government is saying there wouldn't be any shortage, there is no reason to believe the market rumours. We have enough stock of food grains and vegetables."

Against a buffer norm of about 100 lakh tonnes of rice and 170 lakh tonnes of wheat, total central pool stock as on June 1 was 206.45 lakh tonnes of rice and 415.86 lakh tonnes of wheat. As per the second advance estimate, production of wheat is targeted to touch 95.6 million tonnes this year.

Source : economictimes.indiatimes.com