core sector communique

Clarification on P.Chidambaram’s Comments on Prices/Inflation

Shri P Chidambaram, Home Minister, has read reports in the media today on his response to a question on the burden on a common man due to inflation, at the media briefing in Bangalore yesterday. He is shocked and disgusted by the deliberate distortion of the relevant question and answer. The position is clarified further. Answering a question on the burden on the common man, the Home Minister referred to the different segments of the population and the schemes that benefit the different segments. He referred to higher MSP (as benefiting the farmers); MGNREGA (as benefiting the rural poor); mid-day meal scheme (as benefiting millions of children); and he referred to PMGSY (as benefiting thousands of villages). He referred to the price of crude oil and how the Government was constrained to first raise petrol prices and then how it was reduced twice to benefit the middle class. He then said (as can be seen from the exact text of the answer): “You mentioned high food prices. Yes food inflation is high. But higher procurement prices will reflect in slightly higher food prices. But higher procurement prices benefits millions of farmers. If you increase the price of sugarcane, sugar cannot be cheaper than before. If you increase the price of procured wheat or procured paddy, rice and wheat for the consumer cannot be less. Sometimes, and I have written about this once, we are prepared to pay fifteen rupees for a bottle of water but we will not bear one rupee increase in the price of a kilo of wheat or a kilo of rice. We are prepared to pay rupees twenty for an ice cream cone but won’t pay one rupee more for a kilo of wheat or rice.” The Home Minister made a matter-of-fact statement. He did not ‘mock’ or ‘chide’ any one. If the interview is viewed, it will be seen that he spoke in a matter-of-fact manner. The video is available at timesofindia.indiatimes.com. The Home Minister used the word “we”. He did not use the words “why do they make so much noise about price rise”. He did not say “There needn’t be any complaint for price rise when things are on the side of poor farmers”. The report is therefore a complete distortion of his statements.