By Kartik Goyal/ Bloomberg
New Delhi: India believes monetary measures to moderate inflation, which has stayed higher than 5% for seven months, will take some time to come into effect.
Demand growth and credit growth are being moderated, India’s finance minister Palaniappan Chidambaram said in parliament on 4 May. Chidambaram said inflation is being spurred by a combination of rising demand and supply constraints.
The production of wheat, paddy and pulses in India needs to be increased, Chidambaram said. Wheat prices are expected to moderate on higher purchases by the government.
The government plans to buy 15.15 million tonne of wheat this year, up from 9.23 million tonne last year, junior food minister Akilesh Prasad Singh said on 2 March.