Rising tomato prices received widespread attention as it has taken toll on households' budgets: RBI
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Mumbai: A Reserve Bank article on Monday said rising tomato prices have received widespread attention as it has taken a toll on households' budgets and the spillover effect of the spike in the price of the kitchen staple on other commodities remains a "major concern".
In recent weeks, the price of tomatoes has soared to up to Rs 250 per kilogram, mainly due to crop damage.
Amid the steep rise in retail prices, the Centre has started selling tomatoes at Rs 80 per kg in a bid to provide relief to people.
"The recent spike in tomato prices on account of crop damage due to inclement weather and pest attacks in the major production belts has received widespread attention as it has taken a toll on households' budgets," said an article on 'State of the Economy' published in the Reserve Bank of India's July bulletin.
The article also pitched for improving supply chains to contain overall inflation volatility.
The price of tomatoes has started coming down and as per government data, on Monday, the all-India average price of the kitchen staple stood at nearly Rs 120 per kg.
According to the article, historically, tomato prices have been an important contributor to volatility in overall inflation. Its volatility also gets transmitted to prices of other vegetables in both retail and wholesale markets.
"Tomato, being a highly perishable item with a very short crop duration, exhibits considerable seasonal variation in prices but these episodes are short lived," the article authored by a team lead by RBI Deputy Governor Michael Debabrata Patra said.
The central bank, however, said the views expressed in the bulletin are of the authors and do not represent the views of the RBI.
According to a section titled 'Five Facts About Tomato Prices' in the article, the average duration of a high price episode, derived from the Markov Chain transition probability matrix, shows that prices stay above Rs 40 for an average duration of 2.6 fortnights whereas prices remain below Rs 20 for an average duration of 10 fortnights.
"Spillovers from tomato price spikes to prices of other commodities and unhinging inflation expectations remain a major concern," it said.
Increasing amplitudes of price spells over the years calls for improving the supply chains to contain overall inflation volatility, it added.
Further, the article said that food price spikes typical of the onset of the monsoon drove up headline inflation in June, corroborating the Monetary Policy Committee's (MPC) view that the fight against inflation is far from over and monetary policy has to stay the course on the arduous last leg of the journey to align inflation with the target.
Meanwhile, the article also said the global growth momentum appears to be stalling, especially manufacturing and investment, amidst moderating headline inflation with a stubborn core.
Market expectations of future interest rates have gone up in response to the hawkish policy stance while equity prices have flattened and bond yields have hardened.
In India, the rain deficit is rapidly closing amidst a highly cyclone-skewed distribution. Manufacturing and services activity remains in expansion albeit with some sequential moderation in June, the article said.
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Flagrant injustice to underprivileged: Mehbooba on govt action against Shopian school
Srinagar (PTI): PDP president Mehbooba Mufti on Monday said declaring Dar Ul Uloom Jamia Siraj Ul Uloom in Jammu and Kashmir's Shopian an unlawful entity under the UAPA was a "flagrant injustice" to the underprivileged sections of society.
She also alleged that banning such "altruistic institutions" without any solid evidence of anti-national activity "shows a deep seated prejudice and ill intention".
The institution allegedly run by individuals affiliated with a banned organisation has been declared an "unlawful entity" under the Unlawful Activities (Prevention) Act (UAPA).
In a post on X, Mehbooba said, "Every single day the j&k government acts as a mute bystander & a timid enabler of vicious assaults on J&Ks identity & dignity. Declaring Dar Ul Uloom Jamia Siraj Ul Uloom as an unlawful entity under UAPA is a flagrant injustice to the poor underprivileged sections of society".
The former chief minister said the institution served as a "beacon of quality education" for students unable to afford expensive schooling.
"It has produced reputed doctors and professionals who served this nation with dedication. Banning these altruistic institutions without any solid evidence of anti national activity shows a deep seated prejudice & ill intention," she added.
Divisional Commissioner Kashmir Anshul Garg issued a two-page order based on the dossier presented by Senior Superintendent of Police Shopian pointing towards the alleged illegal activities at Darul Uloom Jamia Sirajul Uloom at Imam Sahib in Shopian district in south Kashmir.
According to the order issued by Garg on April 24, there were "credible inputs and evidence on record, to indicate sustained and covert linkages of the institution with Jamaat-e-Islami, which the Government of India banned in 2019.
