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February 2011

Inflation and reforms — You can’t fight inflation by dithering on reform

By Raman Jokhakar
Tarunkumar G. Singhal
Chartered Accountants
Reading Time 1 mins
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New Page 3

49 Inflation and reforms —
You can’t fight inflation by dithering on reform


The common man’s headache
just got bigger. Food inflation spiked to 18.32% for the week ended December 25.
Worse, non-food prices seem northbound as well, including for petrol and
consumer durables. Borrowing costs too are up. Fears about the double whammy of
price rise and possible RBI rate hikes made the sensex nosedive last week, FIIs
exiting massively on the assumption of dented corporate earnings. Balancing the
persisting need to push growth with concerns on generalised inflation, RBI and
the government will have to take a tough call soon on more aggressive hardening
of monetary and fiscal policy, as IMF suggests.

(Source : Times of India, dated 10-1-2011)

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