Friday, April 8 2005 11:55 Hrs (IST) - World Time -

Mumbai: Finance Minister P Chidambaram today (Apr 8, 2005) said that the Government is confident to manage inflationary pressures despite the rising crude oil prices.

"RBI and Government of India are taking necessary steps as we have enough capacity and resilience to withstand the situation", Chidambaram told reporters in Mumbai.

He said the cabinet will take a decision on the hike on petrol and diesel prices after consulting Ministry of Petroleum.

On the interest rate, the Minister said that there is no likelihood of the rates going up in the medium term.

On inflation, he said though the rising crude prices are cause for concern, the recent inflationary figures, however, signal further decline.

On value added tax (VAT), the Finance Minister urged State Governments and traders to implement it as over 130 countries have benefited from the VAT regime.

"Why should India be singled out?" he asked.

The Minister also requested the traders to give up their protest against VAT since it is an effective tax mechanism.

He also said that two more States have agreed to implement VAT while the other left out States would switch over to the VAT regime soon.