Food prices spur inflation
in the first week of April, thousands of people stormed the presidential palace in Haiti, throwing stones and demanding the resignation of President Rene Preval over soaring food prices. In reasonably prosperous Malaysia, the ruling coalition was nearly ousted by voters who cited food and fuel price increases as their main concerns. The us and Japan have begun rationing and the un secretary general Ban Ki Moon has termed the jump in food prices as a "threat to global security'. A World Bank report blamed food price rise as the main reason for skyrocketing inflation all over the world. In India too, the United Progressive Alliance government felt the heat from its allies and opposition over rising food prices that spiked inflation to a three year high of 7.41 per cent in the last week of March.
Food inflation stood at 5.4 per cent in the week ending March 29.The government has banned the export of wheat, rice, pulses and oilseeds. But then food prices are not the only reason for inflation in the country: some of it is also driven by rising steel and metal prices (see box: Steel wears thin). The government is contemplating a ban on export of these commodities.
Export bans, however, have produced only a marginal effect