High growth leading to price pressures: Pranab Mukherjee
The Reserve Bank of India raised interest rates more forcefully than expected last week, signalling its urgency to stamp on inflation.
India's high economic growth is leading to inflationary pressures, finance minister Pranab Mukherjee said in parliament today.Asia's third largest economy is seen expanding 8.5% in the year to end-March 2011. Wholesale price inflation in June stood at 10.55% and chief statistician of India TCA Anant said last month that July headline inflation could be around 11%.The Reserve Bank of India raised interest rates more forcefully than expected last week, signalling its urgency to stamp on inflation.
Mukherjee was replying to a parliamentary debate on price rise, a political hot potato that has given the opposition a handy tool to attack the government with and block proceedings in the house since its opening last week.