Rising food and commodity prices continue to be a cause of serious concern as they have adversely affected growth and social stability in the poor countries, noted the Finance Minister of India P. Chidamabaram at the Development Committee Meeting of the World Bank in Tokyo today. 

Talking about the world economy, the Minister noted that while the recent developments have brought some cheer to the market, but it seems the volatility in the global economy is there to stay for some time. Uncertainty in many countries, a sluggish recovery in others, and slower growth in major emerging economies have dimmed the prospects of a quick turn-around. Exports have been impacted adversely and many currencies have depreciated. Serious risks and uncertainties remain both for the developed and the developing economies. 

The availability of resources for development and the flow of private capital have contracted .The poorest countries are the most vulnerable. At this juncture, we need a well co-ordinated, collaborative and bold global effort to address these challenges. In 2008-09, the World Bank Group had responded to the financial crisis in an exemplary manner. It is a matter of concern that, today, the WBG is constrained in responding in a similar manner. 

Robust agricultural growth remains fundamental to the creation of jobs and poverty reduction. However, agricultural growth faces hurdles that can be removed only with investments, more innovation, better technological inputs and improved extension services. The World Bank Group has an important role in leading this initiative. 

Constraints on “farm to market” need to be addressed quickly while diversion of food grains for alternative uses needs to be curtailed, noted Chidanbaram. He also stated that concerted action needs to be taken against excessive “financialisation of commodity prices”.

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