New Delhi: Finance minister P Chidambaram today said in Parliament that the government would continue with fiscal, monetary and supply side measures to bring down inflation and would not hesitate to import food grains and pulses if needed.

Referring to the previous NDA government, the FM said, the government then took 12-18 months to moderate the inflation rate in 2000-01 when it hovered over eight per cent for 12 weeks and above six per cent for 48 out of 52 weeks.

Replying to MPs during question hour, Chidambaram said, that the current inflation was not as high as 2000-01. "We are confident, inflation will be moderated," he asserted.

Last week, the inflation had declined to 6.02 per cent from 6.5 per cent earlier and the finance minister said that it could be expected to decline further when wheat and potato crops came in to the market.

He said that the consumer price index-based inflation rate for agricultural labourers and rural labourers for December 2006 was 8.94 per cent and 8.31 per cent respectively, primarily due to the high rate of inflation of food articles which has a substantial weightage in the commodity basket of these indices, he said.

In the Indian context, he said, that demand-supply mismatch was the primary source for fuelling inflation.

Production of wheat and pulses was far short of demand and in the long-term augmenting production and productivity was essential to delete the gap. "There is stagnation in production of wheat, paddy and pulses," he said, adding that the budget for 2007-08 addresses the shortcoming on the supply side by addressing key factors like water, seeds, fertilizers, power and farm credit.

In response to a supplementary, he said the government did not allow the export of pulses and allegations against three exporters for defying the ban were under investigation.

Over the last one year, the government had imported 55-lakh tonnes of wheat but could not source pulses, he disclosed. The reason, he said, was because the pulses consumed in India were grown only in Myanmar, Turkey and in small quantities in Canada.

The finance minister also said that while crude oil prices had declined by an all-time high of over $75 dollars barrel, metal prices had risen in international markets.