Is inflation inevitable? Maybe not4 min read . Updated: 16 Oct 2012, 11:17 AM IST
Regardless of the govt’s fiscal profligacy, it does not necessarily follow that there must be inflation
The Indian economy has not been doing well for the past year or so. The currency has spiralled downwards versus the dollar (and other currencies), growth projections have been revised downwards, and the central bank has very publicly warned that the rate of non-inflationary (should actually be called non-accelerating inflationary) growth has been substantially impacted by, inter alia, supply constraints, commodity prices and fiscal pressures. India is facing stagflation, with stagnation being re-defined as simply a drop in the growth rate.
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