oppn parties Inflation Targeting Must Not Be At The Cost Of Growth

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  • Allahabad HC said that the UP Police is acting as law unto themselves as they detained a person unlawfully even before his arrest
  • Kolkata witnesses traffic snarls on the first day of the Durga Puja festival as revellers start pnadal-hopping
  • Neha Bora was subsequently released and Dipke is to appear before a magistrate today at noon
  • Delhi Police detained Cockroach Janta Party founder Abhijeet Dipke, Neha Bora of AISA, student leaders and supporters ahead of a rally in Connaught Place demanding Chief Election Commissioner Gyanesh Kumar's resignation. The protest followed the detention and jailing of two CJP leaders earlier in the week over demonstrations at Jantar Mantar
  • The Reserve Bank of India is considering further monetary tightening to counter capital outflows and increase the cost of betting against the rupee, according to bankers and analysts cited by Reuters. The measures follow recent rate increases and steps to drain liquidity as pressure on the currency and inflation concerns persist
  • India directed oil marketing companies to stop diverting sugar-based feedstocks for ethanol production in the 2026–27 supply year, according to a new tender issued on Friday. The companies have invited bids for 11 billion litres of ethanol made from alternatives including corn and broken rice, amid concerns about domestic sugar supplies and prices
  • Finance Minister Nirmala Sitharaman said India's trade imbalance with China was growing sharply and attributed the problem partly to restrictions on Indian goods and services entering the Chinese market. China subsequently said it was ready to work with India to address mutual economic and trade concerns; India's trade deficit with China reached $69 billion in the first half of FY2026–27, up 27% year-on-year
  • Indian equity benchmarks extended their recovery on Friday, with the Sensex rising 413.66 points to close at 74,729.27 and the Nifty 50 gaining 148.80 points to settle at 23,146.15. Information technology shares, including Tech Mahindra, Infosys and TCS, helped lift the indices
  • India defeated Zimbabwe by four wickets in the opening women's T20 International in Raipur, taking a 1–0 lead in the three-match series. Deepti Sharma and Niki Prasad combined in an 82-run stand after India's top order collapsed, helping the hosts chase down Zimbabwe's total of 114 for five
  • Indian wrestler Komal won bronze in the women's 59 kg category at the Under-23 World Wrestling Championships in Las Vegas, defeating Kazakhstan's Viktoriia Khusainova 7–2. Fellow Indian Amruta Pujari advanced to the women's 72 kg final after recording two pinfall victories
  • Indian shuttler Jagsher Singh Khangurra secured a bronze medal at the BWF World Junior Badminton Championships in Cairo
  • The Supreme Court of India upheld the Bombay High Court's decision quashing the 2020 write-off of ₹8,415 crore in additional tier-1 bonds issued by Yes Bank (Yes Bank). The court ruled that the bank's administrator lacked the authority to extinguish the bonds under the final reconstruction scheme, strengthening bondholders' claims
  • The Supreme Court issued notices to the Election Commission of India, Delhi Police and opposition leaders, including Rahul Gandhi and Akhilesh Yadav, in separate petitions concerning electoral-roll revision and protests held in Delhi on October 10–12. The court also directed the preservation of CCTV footage linked to allegations of police excesses
  • The Supreme Court ruled that a person converting from Hinduism to Islam cannot automatically claim backward-class reservation benefits in the new religious community solely on the basis of their previous caste status. The judgment upheld the Madras High Court's decision striking down a 2024 Tamil Nadu government order that permitted such certification for specified communities
  • The Election Commission of India ordered a Special Summary Revision of electoral rolls in 14 states and three Union Territories, using January 1, 2027, as the qualifying date for voter eligibility. The draft rolls are scheduled for publication on November 12, claims and objections will be accepted until December 11, and the final rolls are due on January 4, 2027
Delhi HC refuses to ban CJP's Tiranga rally at Central Park in Connaught Place today /////// Police says will control and regulate it /////// NDMC closes the park for the public on Friday and Saturday
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Inflation Targeting Must Not Be At The Cost Of Growth

By Our Editorial Team
First publised on 2022-07-14 14:52:33

About the Author

Sunil Garodia The India Commentary view

Although commodity prices have started declining from the highs they had attained after the war started in Ukraine, inflation has remained elevated worldwide. The June figures showed the Consumer Price Index (CPI) was 7.01% percent in India. In the US, inflation was at 9.1% (annualized), the highest in 40 years. As the US Fed has already indicated that it will target inflation by continuously hiking policy rates until it is tamed, the FIIs are going to withdraw investments from India, putting more pressure on the rupee. If dollars become costlier, India's import bill will balloon further and that will add to inflationary pressures. This is a situation that will also lead the MPC of the RBI to hike policy rates and adopt a tight money policy by squeezing out liquidity from the market. Needless to say both these actions, although necessary to fight inflation, will ensure that there is less money to borrow and even that will come at a higher cost. In short, it will puncture growth in the short to medium term.

Normally, cost-push inflation, which is what India and the rest of the world is experiencing now, cannot be fought only by changes in monetary policy. The Centre also pitched in by making adjustments in the import and export policies of some items to cool prices in the domestic market. But the RBI was criticized for falling behind the curve and it is now making it up by pushing through rate hikes in successive MPC meetings, the first in an off-cycle action. But it has to keep in mind that consumer demand is not rising and remains subdued. Hence, growth will be stymied if rates are hiked beyond a certain level. On the other hand, India was performing well on the export front. But with recession predicted in advanced economies, demand for goods and services from such nations will drop, hitting exports too. Hence the RBI has to strike a good balance between fighting inflation and pushing growth. 

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