The Lok Sabha today adopted a compromise resolution asking government to contain inflation at the end of a fiery debate on price rise which Finance Minister Pranab Mukherjee said can be tackled only by a collective action of states and the Centre.

Avoiding the word price rise, the House adopted a resolution moved by Speaker Meira Kumar as a compromise to end the week long deadlock over the mode of debate on which the opposition had demanded a resolution which entails voting.

"This House takes a considered view of inflation and urges the government to take further effective actions to contain its impact on common man," the resolution said.

Replying to the debate, Mukherjee put up a spirited defence of the government policies and said it was "sensitive" to the problem.

He said the states and the Centre should get together to address the problem which alone could bring about a solution.

The Minister said the states have the power under Essential Commodities Act to take action against hoarding but added "I will not pass the buck to them (states) alone."

He utilised the opportunity to appeal to the opposition for a consensus on adopting Goods and Service Tax (GST) legislation that could check fluctuations in prices of items including petrol.

Rebutting the opposition charge on the decision to hike petroleum products prices, cited by it as one of the major reasons for the price spiral, Mukherjee conceded that he was indeed trying to balance his budget but the states were also beneficiaries of this decision.

The government had to provide huge funds to the oil PSUs to overcome under-recoveries on account of sale of petroleum products below the cost, he said justifying the hike.

He also dismissed opposition criticism that the government was insensitive to the plight of the poor saying he knew the difficulty of a villager because he himself had studied under a kerosene lamp and walked to the school for 10 kms in his childhood.

He also hit out at the BJP-led NDA government wondering whether their decision to increase kerosene prices from Rs two a litre to Rs nine was an act of sensitive to the people.

"As a village boy I have studied up to class X under a lamp of kerosene. I used to walk 10 kms everyday to go to school. So I know the life of a villager. Don't ridicule my sensitivity," Mukherjee said.