India’s inflation | India’s inflation situation ‘very alarming’: Kaushik Basu

New Delhi : Former World Bank Chief Economic Adviser Kaushik Basu on Thursday said India’s wholesale price-based inflation is at a 30-year high, creating a worrying situation for the country. Basu, however, said he does not see the risk of rapid inflation and the situation turning out of control. But he cautioned that if retail inflation also follows the path of wholesale inflation, there could be an inflationary crisis.

Wholesale inflation at 30-year high
Participating in the ‘Online’ event of the Asia Society, India, he said the inflation situation in India is at a ‘very risky juncture’.
Basu said, “Inflation is a big risk. And indeed a certain kind of inflation remains high. If you look at the wholesale inflation in India, it is at a 30-year high right now. In general, wholesale inflation has an impact on retail inflation, he said. So this is a worrying situation for India, because the prices are increasing rapidly.

More measures are needed for this
Basu, who was the Chief Economic Adviser to the Government of India from 2009 to 2012, said, “The inflation situation is at a very risky juncture. To deal with this, you need to take steps together with monetary policy and fiscal policy. He said that India needs to take more measures together with the Finance Ministry and the Reserve Bank of India to tackle inflation. Basu said, “I don’t think enough effort is being made on this issue between the finance ministry and the central bank for inflation.”