Terming food inflation as unacceptably high, Finance Minister Pranab Mukherjee said he will meet his state counterparts on 19th January to discuss ways to rein in the rising food prices.

“Food inflation at this level is not acceptable and we are trying our best to control it along with the cooperation of state governments,” Mukherjee told reporters in New Delhi.

He said he would be meeting the state finance ministers on 19th January to discuss among other issues, price rise.

Food inflation fell for the first time in six weeks to 16.91 per cent for the week ended 1st January, but still remains high as vegetables like onion, and protein-based items turned expensive.

Rising food prices also pushed up overall inflation for December to 8.43 per cent, from 7.48 per cent in the previous month.

“WPI month wise has been moderating though it is more than it was in month of November… But it is little less than month of October,” he said.

In October, the WPI inflation was 9.12 per cent.

The Finance Minister said inflation is an economic phenomenon which may have monetary factors behind it.

He said it could be caused by mismatch between demand and supply or international scenario such as crude prices.

Mukherjee said in the event of wide fluctuation in global petroleum prices, no amount of domestic policy measures could drastically bring it down.

Though consumers could be helped by increasing subsidies in petroleum products, it would fuel inflation in the long run, the finance minister said.

“You can help consumers, but providing subsidies…is not helping inflation in long run,” the Finance Minister said.

Fuel and power inflation rose to 11.19 per cent in December from 10.32 per cent in the previous month.

The Finance Minister said he would have pre-budget interactions with state counterparts on Wednesday, where the issue of inflation would also be discussed.

“On 19th January I am having a meeting with the state finance ministers in connection with ensuing budget…I will also raise this inflation issue in the meeting. This is a continuing battle,” he said.

The finance minister said he himself had written letters to states asking them to remove supply bottlenecks in food products.

Mukherjee said the monthly wholesale prices have been declining since August, even as weekly food inflation numbers continued to be volatile.

“I am emphasising on the way weekly fluctuations took place (food inflation) during the month of December…It is little more than November,” he said.

Food inflation remained high through December and also breached the double digit mark and touched the year high of 18.32 per cent for the week ended 25th December.

After that, it moderated to 16.91 per cent for the week ended 1st January.