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Will Keep Food...

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The Prime Minister told businessmen, who called on him to discuss the impact the drought may have on the economy, that government godowns were brimming with food stocks and that "everything possible" will be done to keep prices under check.

Already, 161 districts have been declared drought-prone and Mukherjee said deficient rainfall will result in a 20 per cent decline in sowing of summer crops.

He, however, said, "There is no point in pressing the panic button. This country managed the century's worst drought in 1987. We transported drinking water through railways. We organised fodder for the cattle.

"This country has the experience of handling the situation and I will advice not to press the panic button."

Central agencies like Food Corporation of India have buffer stocks of over 50 million tonnes of rice and wheat and Food Minister Sharad Pawar had earlier said the stocks were enough to last 13 months.

"He (Prime Minister) was quite confident that given the buffer stock, they (government) would be able to handle the food inflation," FICCI Secretary General Amit Mitra said after leading a delegation to Singh.

Singhania also said that investments in agri-market infrastructure should be included in the priority lending of the banks.

Ensuring adequate liquidity to ensure industrial growth was also a key issue, the FICCI President said. He said the Prime Minister has assured them that the government borrowing programme would be managed efficiently.

Against the backdrop of a series of stimulus packages and pressure on the tax revenue, the Centre has announced plans to depend on commercial borrowings of Rs 4,51,000 crore in the current fiscal, a rise of over 25 per cent in 2008-09.

The programme has led to concerns among economists and industry that it would crowd out corporate borrowers, leaving less banking resources for the private sector.

(PTI)