Ahead of the crucial meeting of the Cabinet Committee on Prices for considering options to tame rising inflation, Commerce and Industry Minister Kamal Nath on Monday said the government is looking at further cuts in duties on import of essential commodities, reports PTI .

“Yes, we are looking at further cuts. There is increase in international oil prices and it has to be met with import duty caliberation which we are considering,” Nath told reporters here. The government has already slashed import duty on edible oils, including palm oil from 45 per cent to 20 per cent.

Besides, stringent conditions have been imposed on exports of non-Basmati rice while export incentives on 40 to 50 items, including steel and chemical products have been withdrawn. While the government cut the customs duty on edible oil to control the 13-month high inflation of 6.68 per cent, the foreign suppliers jacked up their margins taking advantage of the shortages in the country, traders said.

Faced with a difficult task of checking price rise, attributed to global hardening trend, Finance Minister P Chidambaram had said in Mumbai on Friday that tackling inflation would be the top priority of the government even if economic growth rate has to be sacrificed by a few percentage points.

Reuter adds: A panel of leading Indian ministers which tracks prices in Asia’s third-largest economy will meet on Monday to debate ways to curb fast rising prices of essential commodities after inflation surged to a 14-month high. A senior government official, who did not wish to be identified, said that the meeting would take place at Prime Minister Manmohan Singh’s residence, reports Reuters.

“Yes, the meeting is scheduled for 8.00 p.m. (1430G) in the evening,” the official said. Data released on Friday showed annual wholesale price inflation — the most widely watched measure — at 6.68 percent in the 12 months to March 15, sharply up from the previous week, largely driven by foods and manufactured products. That put the reading well above 5 percent, near which the central bank wants to contain it in this fiscal year, which ends of Monday.

The ruling coalition’s communist allies on Sunday set a deadline for the government to initiate steps to bring down prices or face protests, newspapers said. “After April 15, we will launch a nationwide agitation on price rise in consultation with other parties which would want to join us on the issue,” Communist Party of India (Marxist) leader Sitaram Yechury was quoted as saying by the Hindustan Times. The left party said the government must cut excise and customs duties on crude oil and reduce retail prices of petrol and diesel, which were increased by about 4 percent in February.

The government — which must face the electorate in general elections by May 2009 at the latest — has taken several fiscal steps in recent days to curb price pressures. They include cuts in import duty on palm and other edible oils, a ban on exports of edible oil, withdrawal of tax refund schemes for steel and cement, allowing duty free imports of rice and an increase in the floor price for exports of non-basmati rice.

Trade Minister Kamal Nath said on Friday the government was trying to boost supplies of key commodities to check prices. Analysts expect inflation to remain above the central bank’s comfort level for the next few months, and say with polls due within a year policymakers have fewer options to bring it down.

“From a political perspective, food inflation matters more than non-food inflation to voters and the government is likely to continue resorting to fiscal measures, including increased subsidies to check food inflation,” Rajeev Malik, analyst at JP Morgan, wrote in a recent research report.

Finance Minister Palaniappan Chidambaram has said the government was determined to take all measures including fiscal, monetary and supply side moves, to moderate inflation and was ready to accept lower growth to curb prices.