New Delhi, July 18: To check soaring prices, the committee of secretaries today decided that wheat imported by the State Trading Corporation would be duty free.

The meeting of secretaries, chaired by the cabinet secretary, also decided to take steps to increase the flow of three key commodities ? sugar, wheat and pulses. The steps will include selective imports and stockpiling by state agencies for redistribution.

These commodities are considered politically sensitive as they are used by most Indians. High prices of these commodities have in the past seen several state governments being voted out of power.

The finance ministry has also indicated to the committee that it may advance its borrowing schedule as a means of mopping up excess liquidity from the market. The government has already advanced its market borrowing excercise from late July. Some Rs 9,000 crore, which was supposed to be picked up in late July, is now being picked up from the market after being notified on June 20.

A senior finance ministry official said the government had earlier reduced the import duty on bulk wheat from 50 per cent to 5 per cent. “Now it has decided to allow duty-free wheat imports by STC.”

The government has also fully exempted pulses from customs duty. The exemption is available up to March 31, 2007. It will be importing some 25,000 tonnes of ‘Urad’ and 5,000 tonnes of ‘moong’. Of this, 18,000 tonnes of pulses are expected to arrive by the end of July, while the rest will come by mid-August.

The ban on sugar exports have affected its futures rate, which is sharply down from Rs 1,931 a quintal to Rs 18,000 a quintal.

“More import and duty decisions are likely in coming months as well as monetary and fiscal measures as prices continue to rise,” officials said. The country's annual inflation rate has already topped 5.5 per cent.

“We expect inflationary pressures to go up, said a planning commission adviser.