Centre may set inflation target, says Finance Mnister P Chidambaram
Chidambaram says economy is stable now, than it was a year ago
New Delhi: Stressing that economic stability should include steady prices, finance minister P. Chidambaram on Friday said Parliament could set an inflation target for the RBI to achieve. Painting a rosy picture of the economy, the minister said the fiscal deficit target of 4.6 per cent of GDP for 2013-14 will be achieved and the CAD will remain below $40 billion, against an earlier estimate of $45 billion.
Talking to reporters after his customary address to the RBI Board following the Budget presentation, Mr Chidambaram, who took over as finance minister in August 2012, emphasised the economy is presently more stable than it was 18 months ago. The Reserve Bank of India appointed, Urjit Patel panel has recommended that the central bank should set a retail inflation target of eight per cent by January 2015 and six per cent by January 2016. Inflation as measured by the consumer price index was 8.79 per cent in January.
Referring to the economy, he said it “is more stable than what it was 18 months ago. That is reflected in the strengthening of the rupee, that is reflected in heightened interest of investors, both FDI and FII.”
He said measures taken by the Reserve Bank of India and the government are complementary and have delivered substantially on the goal of stability set 18 months ago.