Modi seeks to fight inflation with polls 9 months away
INDIAN Prime Minister Narendra Modi promised more measures to rein in rising food prices just as retail inflation last month hit a 15-month high, signalling that cost of living will be a major campaign issue in elections scheduled next year.
“We have to take more steps to minimise the burden of inflation to the people of the country,” said Modi during his Indian Independence Day address from the ramparts of the 17th-century Red Fort in New Delhi. “And we will definitely take steps. Our efforts will continue.”
Modi did not spell out the measures in his speech on Tuesday (Aug 15). The 72-year-old leader wants to retain power for the third consecutive term in the general elections due by May next year, but rising prices along with unemployment are shaping up to be key issues for his Bharatiya Janata Party.
Food-driven inflation is always a concern for political parties in power in India. They have in the past lost elections because they could not control the price of essential items like onions – a staple in diets in the world’s most populous nation.
On Monday, government data showed the consumer price index rose to a 15-month high of 7.44 per cent from a year earlier. Food prices, which make up about half of the inflation basket, rose 11.51 per cent, while fuel and electricity gained 3.67 per cent.
Economists are expecting Modi to consider offering handouts to Indian farmers ahead of the elections, as food commodity export bans to control inflation begin to hurt incomes and could cost him some votes.
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Modi’s administration banned exports of certain rice varieties last month, along with wheat in 2023. The government also imposed curbs on stockpiling some food staples with an eye to keeping inflation in check.
Manipur violence
India’s government is trying to move towards a resolution to the violence in the north-eastern state of Manipur, Modi said in a brief reference to the situation in his national address. Ethnic clashes stemming from a dispute over affirmative action benefits in the state bordering Myanmar have left 150 people dead and displaced 50,000.
“The nation is with the people of Manipur,” said Modi, without elaborating. “The problem will be resolved through peace.”
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Modi this month defeated a no-confidence vote against his government in parliament. The opposition was using the parliamentary vote to ramp up pressure on Modi ahead of elections, and to compel him to speak on the violence between some of the area’s largely-Christian tribal groups and the majority Meitei Hindu residents.
The leader kept a studied silence for two months after the clashes first erupted in May. Modi’s first comments came when a video surfaced in July of two women being paraded naked and allegedly raped in Manipur on May 4, which triggered public anger. BLOOMBERG
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