India mulls scrapping food import duties to fight inflation

India said on Monday it was considering cutting import duties on a host of food and other products "to zero" to boost supply and tame surging inflation.
The announcement came after India's annual inflation rate accelerated to a 13-month high of 6.68 percent late last week, having doubled in just a few months.
Rising inflation has pressured the left-leaning Congress-led government as it faces general elections in early 2009 with its main supporters -- the country's poor --- hardest hit by soaring prices.
"With international prices going to be steep, we're looking at cutting duties on many products, on food front, on edible oil and a whole range of products," Commerce Minister Kamal Nath said.
In fact, the government was looking at "bringing them (duties) to zero if necessary," he told reporters in New Delhi, adding the government was looking at cutting levies on products ranging from steel and cement to cooking oils and grains.
A cabinet committee meeting on the issue was slated for later on Monday.
The government has already slashed import duty on cooking oils from 45 percent to 20 percent.
However, so far this strategy has not proved very effective with foreign suppliers raising their prices to take advantage of the Indian shortages, traders say.
India is the world's biggest purchaser of vegetable oils after China.
The inflation rise has come despite stiff monetary tightening which has pushed official interest rates to a six-year high, slowing economic growth.