Sooo, the rupee has been depreciating on account of inflation. Okay sir, got it. But how did the inflation rate soar to where it is now? It’s the government, who increased the minimum support price of grains by over 33% since 2006 levels. Calculated on production costs, it has increased from 29% to 66% for wheat and 14% to 50% on rice. It was the usual good-for-hungry-kisaan blah-blah bullshit, the usual populist measures in the wake of farmer suicides. The Ministry of Agriculture points out “Since 2006-07, the procurement levels for rice and wheat have increased manifold…Currently, piling stocks of wheat with FCI has led to an artificial shortage of wheat in the market in the face of a bumper crop.” On top of that, the government doesn’t have a formula for deciding the minimum support price. This has been questioned by the CAG in a report to the Parliament. Sir, hum economists nahin hain, par please – a lot of information IS available online. Oooh, that’s right – tabhi RTI is getting modified !!!
Posted on: Sun, 01 Sep 2013 15:22:59 +0000