Food inflation shoots up again

NEW DELHI - India’s annual food inflation shot up to 17.05 percent for the week ended Jan 22, as onions and other items kept prices of food items at a high, as per official data released Thursday.

Food inflation for the previous week was 15.57 percent.

The high food prices will act as a dampener on the government’s efforts to control prices.

A string of measures were announced last month after the Prime Minister Manmohan Singh met senior ministers on how to control prices.

The annual inflation for primary articles rose further to 18.44 percent, compared to 17.21 percent in the previous week, according to data released by the commerce and industry ministry.

Non-food articles were at 25.09 percent for the week ended Jan 22, higher from the 22.48 percent a week earlier.

The annual inflation for fuels, however, slipped to 11.61 percent from 16.4 percent.

The fresh data comes after the Reserve Bank of India raised key interest rates.

The central bank hiked its repurchase or repo rate to 6.5 percent from 6.25 percent and reverse repo rate to 5.5 percent from 5.25 percent in a bid to tame prices that have resulted in annual food inflation soaring to double digits.

It had also revised its current fiscal year-end projections for inflation, raising it to 7 percent from the earlier 5.5 percent.

The government will also be worried as the high inflation could derail its agenda as opposition parties will seek to corner it when the budget session of parliament starts Feb 21.

Corruption and inflation have been the two major arguments opposition parties have been using to attack Manmohan Singh’s government.

The wholesale price index had risen 8.43 percent in December from a year earlier.