RBI Governor Shaktikanta Das, who is due to lead a meeting of the policy panel next month, has signalled more tightening to keep inflation from denting household spending power.
WPI inflation has remained in double digits for 8 consecutive months beginning April while retail inflation based on consumer price index rose to 4.91% as food prices went up.
The RBI monetary policy report also stated India may not be immune to deflationary pressures seen globally, adding that Covid-19 hangs over the future, like a spectre.
Finance Minister Nirmala Sitharaman’s decision to raise duties on fuel is unlikely to threaten the inflation outlook, keeping alive expectation of more rate cuts.
Prime Minister Modi has been restrained about this achievement while most politicians heading into elections would want to cheer their efforts in taming the inflation dragon.
Last 4 years have seen series of reforms, systems have been cleaned up, decisiveness has led to easier decision making and has made the economy stand out.
Finance ministry says the proposed revamp will focus on structural reforms, rate rationalisation & ease of living, & will be deliberated upon in the coming weeks.
The project is meant to be a ‘protective shield that will keep expanding’, the PM said. It is on the lines of the ‘Golden Dome’ announced by Trump, it is learnt.
Standing up to America is usually not a personal risk for a leader in India. Any suggestions of foreign pressure unites India behind who they see as leading them in that fight.
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