Other countries facing steep inflation as compared to India: Hardeep Puri

Union Minister Hardeep Singh Puri on Thursday said that other countries are facing very steep inflation as compared to India currently.

Reacting to a question on high prices of fuel, the Union Minister of Petroleum and Natural Gas while addressing a press conference Wednesday said, " Economies of other big countries are facing steepest inflation and a sharp decline in living standards since World War II. It is a phenomenon. We are in a situation where we can control prices to the extent we can."

"We can only control prices to some extent and give relief to the citizens", he said adding that the living standards in a lot of other countries other than India have declined due to high inflation.

Retail inflation in India surged to 7.79 per cent on an annual basis in the month of April owing to higher edible oil and fuel prices, data from the Ministry of Statistics and Programme Implementation stated in May. The headline inflation is now at the highest level since the 8.33 per cent hit in May 2014.

The surge in inflation is largely driven by rising fuel and food prices, government data showed.

The consumer price-based inflation figure stayed well above the Reserve Bank of India's (RBI's) upper tolerance limit for a fourth consecutive month. RBI has been mandated by the Centre to keep the retail inflation between 2 per cent to 6 per cent.

Food inflation, which accounts for nearly half the consumer price index (CPI) basket, reached a multi-month high in April this year and can remain elevated due to higher vegetable and cooking oil prices globally. RBI mainly considers the retail inflation figure while arriving at its bi-monthly policy decision.

Sunil Kumar Sinha, Principal Economist, India Ratings and Research said to ANI, "Based on the present trend, average inflation in FY23 is likely to be closer to 7 per cent and may peak in September 2022 thereafter declining marginally. RBI has increased the repo rate by 40bp and CRR by 50bp in May 2022. India Ratings expects monetary tightening to continue and expects repo rates to increase by 60-75bp and CRR by 50bp in FY23. However, India Ratings believes the future rate hikes will be data-dependent."

Sachin Gupta, CEO of Share India Securities said to ANI, "Due to the ongoing geopolitical tensions and high commodity prices, it was expected that the inflation numbers will be on the higher side. Anticipating this, RBI has already started fiscal tightening by increasing the repo rate. With the global uncertainty continuing and commodity prices remaining high, the inflation numbers may witness upward pressure in coming months also."

DK Mishra, an economist had said, "What we see RBI will try to increase the repo rate further. There is one more possibility that RBI may increase the upper comfort level of inflation, to more than 6 per cent which can be accepted phenomenon for the time being to see that inflation will continue to trouble us in the short term time span.