A top government source on Thursday said India is relatively "better placed" in the context of global inflation and efforts taken in the past few months are now showing results.
"India is relatively better placed. Steps taken up beginning March this year are now showing up on the ground. With good monsoon, half the battle is won. However, it is not that inflation is no more a worry. We will have to keep an eye," the official said.
The government is looking at the price rise issue so that the common man is not affected. "Every angle is being looked at. Effort is happening on all the sides," the official added.
Inflation had been rising in the Indian economy as an impact of the supply disruption and high commodity prices in the wake of the Russia-Ukraine war. Retail inflation peaked to 7.79% in April after which both central government and Reserve Bank of India took a slew of measures.
To begin with the RBI held an off-cycle MPC meeting and hiked the repo rate. The banking regulator also announced liquidity withdrawal measures in the meeting.
The Centre also banned wheat exports. Among the key steps was the reduction of central excise on petrol and diesel by ₹8 per litre and ₹6 per litre, respectively. The Centre also gave LPG subsidy of ₹200 per cylinder for Ujjwala Yojana beneficiaries.
Apart from these, customs duty on raw materials and intermediaries for plastic products was reduced and import duty was cut on select raw material for steel. The Centre also notified duty free import of crude, soya bean, sunflower oil for two years. With the measures, the retail inflation in June eased to 7.01%.
On being asked whether the widening trade deficit and current account deficit are a greater worry in the economy, the official said, "At any point of time, any aspect of the economy has to be equally monitored. Sometimes spurt in one sector gets aggravated as many other factors come into play. We take care of all economic issues equally." The official was hopeful that with the global crude oil prices easing, and fertiliser prices decreasing and excessive coal imports under check, payments outside will also get decreased