Indian prices at three year high

Indian inflation is at its highest in over three years as food and energy costs continue to rise, official figures show.

India's wholesale price index, released weekly, hit 7.57% for the year up to 19 April, the highest since November 2004.

The government has been taking steps to control inflation, raising bank cash requirements and limiting rice exports.

India's finance minister Palaniappan Chidambaram said food prices would fall in coming months.

In India, the wholesale price index, which measures inflation at the "factory gate", is more closely watched than the consumer price index because it tracks a wider range of goods.

The consumer price index reflects shop and market prices.

Record prices of rice, wheat and other foodstuffs, along with the sky-high oil price, have fanned inflation worldwide.

This has prompted many governments to impose price controls and curb exports of essential goods.

Fighting inflation is a top priority for India, where a much higher proportion of people's income is spent on food than in more developed countries.

"Inflation could ease over the next few weeks, as the impact of these measures takes hold," said Gaurav Kapur, senior economist at ABN Amro bank in Mumbai.

"That said, risks still pretty much remain on the upside for inflation, especially considering that no relief seems to be in sight from the spiralling international commodity prices."

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