New Delhi: Promising to keep prices down ahead of the festival season, Government today (Sep 17, 2004) said it would ensure adequate supply of essential commodities and take more fiscal and monetary steps to contain inflation which has significantly fallen by 0.5 per cent to 7.81 per cent.

"The Government will take measured steps on the monetary and fiscal side to moderate inflation and inflationary expectations," Finance Minister P Chidambaram told reporters after a meeting of the Cabinet Committee on Prices, "The country had adequate stocks of essential commodities and there was no reason for prices to go up."

"We will ensure there are no supply side constraints," he said expressing confidence that the recent measures would have a sobering effect in bringing down prices.

Chidambaram assured there was adequate stocks of food grains, pulses, edible oil and sugar.

The steps taken for enhancing the availability of sugar and yesterday's announcement of downward revision of tariff value on certain edible oil "we think will have a beneficiary effects on prices", he said.

Chidambaram said the Cabinet Committee on prices reviewed the situation and "I shared the news of the wholesale price index coming down from 8.33 to 7.81 per cent."

"The situation is required to be carefully watched. We have adequate stocks of essential commodities and there is no reason at all for these prices to increase," he said asking consumers to resist any attempt by anyone to push up prices artificially in mandis and markets.

He said even during the truckers strike, the wholesale prices did not rise. But some retail markets prices showed tendencies to rise.

"Even if consumer resist buying from the market for one or two days, the message will go to retail vendors (not to artificially increase prices)," he said.

To a question on what could be the expected inflation rate in the coming months, Chidambaram said he was not in the business of speculation.

"Some of the factors like global crude oil prices were not under the control of the Government," he said, adding "Government will continue to take measured monetary and fiscal steps to moderate inflation and inflationary expectations."

The items price level of commodities that were reviewed by the Cabinet committee on prices included sugar and edible oils, particularly vanaspati in view of the coming festival seasons.