January 2013
International Journal of Research in Computer Application & Mana;Jan2013, Vol. 3 Issue 1, p140
Academic Journal
In this phase of deep global recession, India is one of the economies around the world that are experiencing high pangs of inflation. Indian economy is facing the effects of severe inflation in the form of rising food and energy prices. An uncomfortably high level of inflation is one of the major pressures on India's macroeconomic climate following the global financial crisis. Between the period 2008-09 and 2011-12, inflation in India can be attributed to both microeconomic and macroeconomic factors. The microeconomic factors responsible for high inflation include adverse supply shocks coming from failure of monsoon and high volatility in global crude oil prices. The macroeconomic factors include the demand side mismanagement and failure in coordination between fiscal and monetary policies. This paper attempts to identify the factors including government's monetary and fiscal policies that are responsible for inflation in the country. This paper not only seeks to examine the relationship between inflation and output gap but also identifies possible policy challenges arising from high inflationary trends and their implication on Indian economy.


Related Articles

  • Inflation And Indian Economy -- An Analysis In Indian Context. Patil, Usha N. // Golden Research Thoughts;Oct2012, Vol. 2 Issue 4, p1 

    It is hard to believe the fact that even after 21 years; we are again going through another turbulent phase. True, we have definitely grown since 1991 but the main imbalances then -fiscal deficit and current account deficit- are in reckoning again and have become the main concerns of today....

  • CONSOLIDATING MACROECONOMIC ADJUSTMENT IN BRAZIL. de Mello, Luiz; Moccero, Diego // OECD Papers;2006, Vol. 6 Issue 13, p1 

    The article discusses the policy options that could be implemented in support of the consolidation of macroeconomic stabilisation in Brazil. The authors imply that monetary policy continues to respond swiftly to changes in the inflation outlook, anchoring expectations. Fiscal policy has been...

  • Crocodile Tears. Mehra, Puja // Business Today;2/6/2011, Vol. 20 Issue 3, p27 

    The article focuses on the belief that the United Progressive Alliance (UAP) government is not prioritizing food price inflation in 2011 in India. It mentions the price increases of vegetables and fruits which contribute to 40% of inflation. It is said by V. S. Vyas, a member of the Economic...

  • Some Measures of Core Inflation for India. Bicchal, Motilal; Sharma, Naresh Kumar; Kamaiah, Bandi // IUP Journal of Applied Economics;Jul2012, Vol. 11 Issue 3, p22 

    This paper discusses in some detail various existing approaches of measuring core inflation, evaluating their potential advantages and disadvantages. Then a variety of measures of core inflation for India based on three methods are constructed. Among these measures, three are based on...

  • Dynamic Analysis of Two Policy Lags in a Kaldorian Model. Tsuzuki, Eiji // Discrete Dynamics in Nature & Society;10/12/2015, Vol. 2015, p1 

    We examine the effects of policy lags on local economic stability using a Kaldorian model. This study analyzes two cases: the case of a monetary policy with a time lag and the case of a policy with both fiscal and monetary lags. Similar to the case of fiscal policy lags examined in a previous...

  • Five risks worrying RBI governor Raghuram Rajan about India.  // FRPT- Finance Snapshot;4/ 6/2014, p18 

    The article reports on the concern of Reserve Bank of India (RBI) Governor Raghuram G. Rajan on economic risks in the country. It mentions the focus of their monetary policy on maintaining and protecting economy from inflation. It also notes that reverse repo rate and Cash Reserve Ratio (CRR)...

  • Sovereign Default and the Stability of Inflation-Targeting Regimes. Schabert, Andreas; van Wijnbergen, Sweder J G // IMF Economic Review;Jun2014, Vol. 62 Issue 2, p261 

    We analyze the impact of interactions between monetary and fiscal policy on macroeconomic stability. We find that in the presence of sovereign default, macroeconomic stability requires monetary policy to be passive if the feedback from debt surprises back to the primary surplus is too weak. An...

  • From The Board. NARAYAN, SANJOY // Business Today;7/27/2008, Vol. 17 Issue 15, preceding p3 

    The article discusses various reports published within the issue, including one by Rishi Joshi on the effects of inflation on India's economy and another on the performance of the United Progressive Alliance (UPA), a Congress-led coalition which aims to promote economic reforms in India.

  • India's Inflation Stuck at 9.9 Percent. Kinetz, Erika A. // India -- West;4/23/2010, Vol. 35 Issue 22, pA37 

    The article reports on the 9.9 percent inflation rate received by India in the month of March 2010 due to increasing prices of food and fuel.


Read the Article


Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics