Finance Minister Nirmala Sitharaman on Thursday said lowering inflation cannot be the sole responsibility of the Centre and that states also play a vital role in it, The Indian Express reported.
“It cannot be that inflation is handled only by the Centre,” Sitharaman said. “And when states don’t take enough steps, that part of India suffers from wanting a relief from the stress of inflation.”
Sitharaman made the remarks while addressing an event organised by the Indian Council for Research on International Economic Relations in New Delhi.
In July, India’s retail inflation eased to 6.71% from 7.01% in June. However, despite the decline, the price rise indicator remained above the upper limit of the Reserve Bank of India’s prescribed range for the seventh straight month. The central bank aims to keep retail inflation in the range of 2% to 6%.
On Thursday, Sitharaman said that inflation was higher than the national level in states that have not reduced fuel prices, according to The Indian Express.
“Very recently, widely-available information in the public domain shows how inflation has varied from state to state,” the finance minister said. “There could be several reasons for it. But the fact remains, and I find, coincidentally, and I am being careful here…Coincidentally, inflation being higher than the national level inflation in states which have not reduced the fuel prices.”
The Centre had slashed the excise duty on petrol by Rs 8 per litre and diesel by Rs 6 a litre in May. The move had reduced the price of petrol by upto Rs 9.5 per litre and diesel by Rs 7 a litre. Fuel prices vary in states due to different value-added tax and freight charges.
During Thursday’s event, the finance minister also lauded her government’s decision to buy crude oil from Russia despite criticism from Western countries.
“And that’s where I give credit to the statesmanship of the Prime Minister [Narendra Modi] to make sure globally that we did keep our relationships with all countries but yet managed to get the Russian crude,” Sitharaman said.
She added: “And how speedily did we manage to do it. Otherwise, our entire import from Russia was probably 2% or sometimes even lesser, it was ramped up to almost 12-13% within a couple of months.”