Inflation a worry, but no hurry to end stimulus: Montek
12 Jun 2010
While inflation may not decline on a year-to-year basis, India need not quicken the pace of its return to a tighter monetary policy, deputy chairman of the Planning Commission Montek Singh Ahluwalia told CNBC-TV18 in an interview on Friday.
"The current level of inflation is a matter of concern," Ahluwalia said the government's bid to drastically curb inflation may be an overreaction, adding, "A normal monsoon is likely to temper inflation expectations."
Inflation, he added, is likely to ease to 6 per cent by November-December.
"It's going quite well, I don't think it needs to be swiftened," Ahluwalia said. He added that he expects double-digit industrial output growth in FY11.
India's industrial output rose much faster than expected at 17.6 per cent in April from a year earlier on strong consumer demand and government spending.
Buoyed by over 17 per cent industrial growth in April, the highest for 2010 so far, Ahluwalia said the government's policies were "working" and that it should continue with gradual withdrawal of stimulus.
