Pranab asks states to help check price rise

The finance minister, Mr Pranab Mukherjee, on Wednesday called on state governments to take a coordinated action with the Centre to control rising prices, saying it was a joint responsibility of the nation’s political leadership.

“Coordinated action by the Centre and states is needed, else it would be difficult to deal with the problem of price rise,” Mr Mukherjee said while replying to the debate in the Lok Sabha on inflationary pressures in the economy and its impact on the common man.

Holding states equally responsible for rising prices, the minister noted that they had powers under the Essential Commodities Act and the Essential Services Maintenance Act to deal with hoarding. “But I will not pass on the buck to them alone.”

The finance minister also urged the House and the states to cooperate in introducing the Goods and Services Tax by April 1, 2011 to help check inflation. “Time is running out. We must bring in the constitutional amendment Bill in this session to pave the way for GST,” Mr Mukherjee said. He said the recent hikes in petrol, diesel and kerosene prices were necessary, and added the petroleum sector was an important source of revenue for states, accounting for 34 per cent of their earnings. He noted the NDA government had raised kerosene prices from Rs 2 to Rs 9 per litre, while the UPA had hiked it from Rs 9 to Rs 12 per litre: this, he said, showed the difference in “sensitivity” of the two towards the common man. “I am a village boy, studied under a lamp post and walked 10 km to school. Don’t ridicule my sensitivity,” the minister said, in a dig at the Opposition.

“Mere rhetoric can’t locate petroleum sources. The priority is also to ensure the availability of petroleum products,” he said, observing that oil marketing PSUs were given a subsidy of Rs 1.03 lakh crore in 2008-09 to ensure that petroleum products were available at affordable prices.