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Economists tell FM to take steps to boost farm output
January, 18th 2011

Identifying high inflation as a big worry, country's leading economists have asked finance minister Pranab Mukherjee to take measures to boost farm productivity and improve supply of agricultural products .

In a pre-budget meeting with Mr Mukherjee, economists, including Partha Sen and Delhi School of Economics professor Pulin Nayak, FICCI director general Rajiv Kumar, Ajit Ranade from Aditya Birla Group, Bharat Ramaswamy from Indian Statistical Institute , Delhi and Pulapare Balakrishnan from Centre for Development Studies, wanted the finance minister to stick to fiscal consolidation.

"Efficiency of Indian agriculture needs to be improved," said Rajiv Kumar after the meeting.

Professor Nayak said the government should focus on completely doing away with the problem of malnourishment and undernourishment.

Speaking to economists, Mr Mukherjee said rapid recovery of the growth momentum is comforting, but the country cannot be complacent. "Global recovery remains fragile," he said adding that India's growth momentum, to some extent, is affected by developments in the Western world. A faster recovery in the West is in the global interest, he said, according to an official statement.

He expressed concern at the rising commodity prices. "The creeping increase in international crude oil and other commodity prices is a reality ... High food prices, caused in part by severe drought conditions last year and by rising incomes, have been driving inflation in India," he said.

Mr Mukherjee said the challenge before the government and the monetary authority has been to support the recovery process without compromising on price stability. "The task has not been easy," the minister said.

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