China's cabinet orders local governments to take measures to rein in surging food prices

BEIJING, Nov. 20 (Xinhua) -- The State Council, China's cabinet, Saturday ordered local governments and departments to take further measures to battle rising prices.

Local governments and departments must boost production and ensure supply while checking irrational demand and punishing illegal activities that push prices up, a circular on government website www.gov.cn said.

The measures cover agricultural production, the stabilization of the supply of agricultural products, reduction in the cost of agricultural products and temporary subsidies.

From Dec. 1, road-toll stations are forbidden to collect fees from vehicles transporting fresh agricultural products, including vegetables, fruit, aquatic products, meat, eggs and milk.

Potatoes, sweet potatoes, fresh corn and fresh peanuts are new items added to the free-from-road-toll list, the circular said.

China's CPI, the main gauge of inflation, rose to a 25-month high of 4.4 percent year on year in October. The hike was mainly due to a 10.1 percent surge in food prices. Food prices have a one-third weighting in the calculation of China's CPI.