Food inflation dips, but still remains high

India's annual food inflation for the week ended 1 January fell to 16.91 per cent, compared to 18.32 per cent in the previous week, bringing some cheer to senior ministers who have been conducting hectic parleys to curb the soaring food prices.

The drop comes after five straight weeks of rise the in food inflation rate, based on wholesale prices. The fall in the index was because of some tempering in prices of onions from the peak of Rs70 per kg last month. The prices of other essential commodities like pulses and food grains too came down, according to data from the commerce and industry ministry.

However, inflation remained high enough to keep pressure on the government. On an annual basis, the food price index rose 16.91 per cent, driven mainly by high vegetable prices, and the fuel price index climbed 11.53 per cent in the year to 1 January, the data on Thursday showed.

In the previous week, annual food and fuel inflation stood at 18.32 per cent and 11.63 per cent respectively.

Food makes up about 14 per cent of the wholesale price index, while fuel contributes about 15 per cent.

According to Thursday's data, the 52-week inflation rate for non-food articles slipped to 20.49 per cent for the week ended 1 January, compared to 22.4 per cent in the previous week.