Finance minister Nirmala Sitharaman, during her address at the conference on ‘Taming inflation in India’ by Indian Council for Research on International Economic Relations (ICRIER) today, said that even in this interconnected world, the Indian economy has managed inflation well, which is not merely a monetary exercise. She says the RBI will have to synchronise more with the Centre – but not as much as other western developed countries – to handle inflation as it is an exercise where the fiscal policy, together with the monetary policy, has to work.
“If the global disruptions because of supply chain and other things are bothering every economy today, including us, purely what is within India is the monsoon, which has always kept us on our toes about supply chains,” says the FM.
She says India’s experience in handling inflation depends so much on so many factors, the central bank, its instruments, its interest rate management, etc. “I would say India’s inflation management…is an exercise of so many different activities and the majority of which is outside of the monetary policy given in today’s circumstances,” says the minister.