Description
This project is basically based on the current status of inflation in india
DEFINITION OF INFLATION
The overall general upward price movement of goods and services in an economy often caused by an increase in the supply of money, usually as measured by the Consumer Price Index and the Product Price Index is called as Inflation. In real terms Inflation may be defined as persistent and appreciable rise in general level or average of prices.
CURRENT STATUS OF INFLATION IN INDIAN ECONOMY
1.Dismantling of most administered interest rates 2.Progressive opening of the economy 3. Competiveness of domestic industry 4. Monetary policy changes
India has had inflation almost continuously over a period of six decades, though the rate of inflation has been changing ± sometimes low, sometimes high ± and in some years there was deflation.
2/28/2012
Rate of inflation in percentage
10 8 6 4 2 0 rate of inflation in percentage
REASONS FOR INFLATION IN INDIA
1. 2. 3. 4. 5. 6. 7.
High food prices Slow Reform Movement Earnings Slowdown Current Account Deficit Industrial Growth Rising Interest Rates Fiscal Deficit
EFFECTS OF INFLATION ON ECONOMY 1. 2. 3. 4. 5. 6. 7. 8. 9. Distribution of income Distribution of wealth Wage earners Producers Fixed income class Borrowers and lenders Government Economic growth Employment
MEASURES TO SOLVE INFLATION
MONETARY MEASURES
OTHER MEASURES
FISCAL MEASURES
1.Control over money 2.Credit control
1.Increase in production 2.Commercial policy 3.Encourage savings 4.Investment policy 5. Marginal requirements
1.Decrease in Public expenditure 2. Delay in payment of old debts 3. Increase in taxes 4.Over valuation of money
CONCLUSION The global economic crisis saw many economies stumble but India rebounded faster and was surging ahead with a growth rate of 9%. But the inflationary pressure is forcing the government to adopt measures which are taking the steam out of the Indian growth story. For the last two years India is witnessing double digit inflation which had reached a high of around 18% in December 2010 with prices of onions, garlic and tomatoes skyrocketing. Lentils, milk and meat have witnessed a steady rise in prices which is putting pressure on the home budget of millions of Indians.
SUGGESTIONS
doc_209568066.pptx
This project is basically based on the current status of inflation in india
DEFINITION OF INFLATION
The overall general upward price movement of goods and services in an economy often caused by an increase in the supply of money, usually as measured by the Consumer Price Index and the Product Price Index is called as Inflation. In real terms Inflation may be defined as persistent and appreciable rise in general level or average of prices.
CURRENT STATUS OF INFLATION IN INDIAN ECONOMY
1.Dismantling of most administered interest rates 2.Progressive opening of the economy 3. Competiveness of domestic industry 4. Monetary policy changes
India has had inflation almost continuously over a period of six decades, though the rate of inflation has been changing ± sometimes low, sometimes high ± and in some years there was deflation.
2/28/2012
Rate of inflation in percentage
10 8 6 4 2 0 rate of inflation in percentage
REASONS FOR INFLATION IN INDIA
1. 2. 3. 4. 5. 6. 7.
High food prices Slow Reform Movement Earnings Slowdown Current Account Deficit Industrial Growth Rising Interest Rates Fiscal Deficit
EFFECTS OF INFLATION ON ECONOMY 1. 2. 3. 4. 5. 6. 7. 8. 9. Distribution of income Distribution of wealth Wage earners Producers Fixed income class Borrowers and lenders Government Economic growth Employment
MEASURES TO SOLVE INFLATION
MONETARY MEASURES
OTHER MEASURES
FISCAL MEASURES
1.Control over money 2.Credit control
1.Increase in production 2.Commercial policy 3.Encourage savings 4.Investment policy 5. Marginal requirements
1.Decrease in Public expenditure 2. Delay in payment of old debts 3. Increase in taxes 4.Over valuation of money
CONCLUSION The global economic crisis saw many economies stumble but India rebounded faster and was surging ahead with a growth rate of 9%. But the inflationary pressure is forcing the government to adopt measures which are taking the steam out of the Indian growth story. For the last two years India is witnessing double digit inflation which had reached a high of around 18% in December 2010 with prices of onions, garlic and tomatoes skyrocketing. Lentils, milk and meat have witnessed a steady rise in prices which is putting pressure on the home budget of millions of Indians.
SUGGESTIONS
doc_209568066.pptx