Finance minister P. Chidambaram with CII president Sunil Bharti Mittal (right) and Assocham president Venugopal Dhoot (centre) in New Delhi on Monday. (PTI)

New Delhi, March 3: Finance minister P. Chidambaram today said the government would offer policy support to an industry if it suffers from a slowdown.

In a meeting with the captains of industry here today on the budget, Chidambaram said he had given across-the-board-tax cuts to industry besides greater relief to specific segments which should aid growth.

He also said he would look at specific industries that were hit by a recession and slow growth. “I think our tax rates are moderate and stable. But I will look at any specific sectors where growth has been held back.”

Some at the meeting promptly pointed out that the two-wheeler industry, given excise relief on a par with small cars, was hit by a severe recession.

“Two-wheelers are used by the real aam admi,” Hero Honda managing director Pawan Munjal said to press for a review of the 12 per cent excise duty announced in the budget.

Faced with competition from the Tata small car, two-wheeler makers have been lobbying with the government for more duty cuts. Two-wheeler sales dropped 8 per cent between April 2007 and January 2008.

Large car makers, who face an excise duty of 24 per cent, have also been clamouring for more cuts in the duty, claiming a slowdown in sales.

Price worry

Chidambaram said inflation remained a concern for his government.

He said rising food prices were pushing up inflation.

“If we have enough food to feed our people, we are insulated from world prices, but if we are dependent on imports, we are subject to world prices,” the minister said.

He said world prices of wheat had increased 88 per cent since April 2007 and those of rice by 15 per cent. Chidambaram blamed stagnant farm growth for fuelling the foodgrain-price spiral.

Inflation hit 4.89 per cent in mid-February, the highest in more than eight months and just below the Reserve Bank of India’s target of 5 per cent for the fiscal year ending March 31.