Inflation to be brought down to single digit: Ahluwalia

By Manish Chand, IANS,

On Board Air India One : Planning Commission Deputy Chairman Montek Singh Ahluwalia Tuesday said the government was expecting to bring down inflation to single digit level before the end of the current financial year.

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“Inflation is not something which we can bring under control immediately. Fortunately the tendency of constant increase (inflation) has disappeared,” Ahluwalia told reporters on way to New York.

“I expect inflation to come down to single digit before the end of the financial year (that ends March 2009).”

Ahluwalia is part of Prime Minister Manmohan Singh’s official delegation to the US.

India’s annual rate of inflation is currently hovering around 12 percent. Inflation is going to be a plank in the Lok Sabha elections due early next year with the opposition Bharatiya Janata Party (BJP) targetting the United Progressive Alliance’s “incompetence” over the rising prices.

The deputy chairman suggested that the government should move towards monitoring inflation in terms of consumer price index rather than the current practice of measuring inflation in wholesale price index.

He said the international commodity prices including that of oil would soften in the days to come.

Playing down fears of the downturn in global economy impacting India, he said: “The Indian banking system is not directly related to it. Direct impact is almost negligible.”

He underlined that the world economic recovery will start around 2009.