By Swati Deb
NEW DELHI:Now that nuclear politics has oveshadowed inflation and the Congress-SP deal seemingly fructifying, the UPA constituents put up a brave face for the first time since price rise has hit the country hard and rather ask - does the world stop at that?
A key functionary of LJP in Chemicals Minister Ram Vilas Paswan's party said, the question of inflation rise needs to be seen particularly in the context of pan-Asian and even on a bigger canvas. "Not long ago, the Malaysian government imposed a hugely unpopular 41-percent price hike. Do you know inflation is much higher in Sri Lanka and Indonesia than ours?," he asks.
It may be mentioned that Sri Lanka had the experience of highest annual inflation in Asia with April figures touching 25 per cent while Vietnam recorded at 21.4 per cent has the second highest inflationrate in the region during the month.
Now, the argument from UPA functionaries and officials in Finance Ministry is that, the Indian position has never been as bad. This isbecause of the strong resilience power and also because the Government of India didn't press the panic button, said one of the economicadvisers to Finance Minister P Chidambaram.
Instead, they say, the government rightly concentrated on stepping up measures – some of them drastic ones to douse the inflation. The official line is that the extreme price rise was limited to a few commodities like milk, cotton and iron and steel, besides petroleum, and not across-the-board.
Moreover, the most important driver of the current inflation was true reflection of global trends – it was the relentless rise in crude oil prices. In fact, the Government had a hard pressing time as since the Budget 2008-09 was presented on February 29, 2008, the crude oilprices have increased by 37 per cent.
Well, it's true the Government had increased the price of fuel. But the tough situation demanded tougher stand, said the economic adviser.
The government argument on fuel hike is also assertive, as they say, with world oil prices having reached astronomical levels, the state-run oil companies could not have continued subsidizing supplies of petroleum products. If left unchecked, the present situation would have led to oil companies going deep into the red - and that would have been a worse disaster.
In fact, by June, it was established that the agriculture products and foodgrains prices did not go up much but the heavy fuel prices contributed hugely for the scenario. During the week ending June 13, 2008 prices of wheat remained steady at all reporting centres.
Prices of sugar remained steady at all the reporting centres. Importantly, in yet another move the government decided to import 1 lakh metric tonnes of edible oil to be distributed especially through the ration shops. The idea was to boost supplies to give a cushion to the common people, especially to those availing the benefits of PDS, sources said.
On the political front, on Friday, ending hours of speculation, the Samajwadi Party top brass - duo of Mr Mulayam Singh Yadav and Mr Amar Singh - gave a clear indication of having already sealed the deal with Congress in the event of an inevitable withdrawal of support by 59-member strong Left parties.
Both Mr Yadav and Mr Singh again reiterated the trump card for agreeing to the deal with Congress saying their top priority was to keep the "communal forces" that is BJP away from power. The party, whose 39 MPs in the Lok Sabha would be must for survival of the government if Left parties withdraw support, which is likely to happen after July 7, is now waiting in the wings to announce its decision on supporting the UPA around the same time. That they would back the government on the nuclear deal was clear enough last night after they got a nod in its favour from former President Dr A P J
Abdul Kalam.
"We have been opposing it (nuclear deal) as we did not have any new details. But now these new details have come," Yadav told reportersoutside the 7 Race Course Road adding "All new facts were presented to us by the PM".
On the other side, the Left parties today set July 7 as deadline for Pranab Mukherjee, chief negotiator on the N-deal with left, to make government's position clear.
PM Manmohan Singh is to leave for Japan on July 7 to attend G-8 summit where in on the sidelines he would also interact with US President George Bush and give further push to India's commitment to the deal. Earlier on the day, SP leaders indicated that the parting of ways with the newly born third front UNPA now looks only a matter of time asboth of them called on the Prime Minister Manmohan Singh and Congress Chief Sonia Gandhi separately and understood to have given final touches to the agreement between two sides.
After their 30-minute meeting with the Prime Minister, both theleaders made it clear that they were convinced that the deal is in"country's interest". Mulayam Singh has gone a step further to prove the point beyind doubt, when he said that Prime Minister presentedthem "new facts" on the deal and that they would try to convince other UNPA
