Question:

What is the stand of cetral Gvernment on inflation?

by Guest60210  |  earlier

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I want to know this answer from economical view. Thanks you a lot in advance.

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3 ANSWERS


  1. Stand! Govt. is sitting.


  2. GOI and rbi are working in close tandem for controlling inflation,government wants to keep inflation at 5.5% but this is not possible as globally the prices of all the commodities are rising .This is becoz pressure on limited resources is increasing due to increase in demand form consumers.Hence to decrease the credit out take the RBI recently announced rise in repo(i.e. the intreset on maoney taken by the banks from RBI) hence the banks will pass on this to consumers.All this is done to suck out the excess liquidity from the market and in turn control the inflation.Also there are other tools that RBI is using other than Cerdit policy.The GOI has annouced cuts in duty on key raw materials , but this would be a diffcult task.

  3. It has taken a stand that the inflation is imported on account of petroleum prices. We can't get a quickfix on energy front because though we are ready to go nuclear route nobody is willing to give Uranium for running our nuclear power generators as india has not signed NPT. Food prices are high because global food output has come down. There is mutual recrimination. India says the west diverting farmalands for production of bio-fuel and they telling India that because of India has put additional demand on food resources raising its prices.

    This in a nutshell is the story!

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