Inflation in India *



Case Code : CLIBE058
Publication date : 2005
Subject : Business Environment
Length : 04 Pages


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Abstract: ICMR India ICMR India ICMR India ICMR India RSS Feed

The caselet explains the trends in inflation in India and the impact of inflation on the economy as a whole. It explains the reasons for inflation and measures to be taken to control it. It even highlights the role of RBI in helping government to manage inflation.


Impact of inflation on the Indian economy.
Reasons for increasing inflation rates in India.
Measures taken by the Indian government (fiscal measures) to control inflation.
Role of RBI (monetary measures) in managing inflation in India.


India is a fast growing economy and has the potential to compete with the other big economies of the world. However, a growing population, increasing inflation, political instability, need for infrastructure development, and many other issues are causes for concern for the Indian economy.

In fact, these issues are preventing the growth of the Indian economy to a considerable extent. Out of all these factors, it is the impact of inflation that is felt across all sections.

Questions for Discussion:

1. Inflation has to be tackled efficiently to ensure the future growth of the Indian economy. How do you find the inflation situation in the financial years 2004 and 2005 in India?
2. Comment on the measures taken by the GoI and RBI to control inflation. How successful do you think they will be in controlling inflation?

Key words:
Inflation, economy, population, infrastructure development, goods, services, products, primary articles, Government of India (GoI), Reserve Bank of India (RBI), commodities, CRR, bank rate, repo rate, credit policy

* This caselet is intended for use only in class discussions.
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