Expedite reforms to offset Iraq effect

New Delhi: Turmoil in Iraq will punch a big hole in the finances of the Indian government forcing it to go in for “further bitter medicine” for the consumers of goods and services that would exert pressure on prices pushing the economy further into the vicious circle of high inflation and low growth, an Assocham study said on Sunday seeking all-out efforts to somehow keep the rupee strong at this critical moment.

The study has pointed out that a slew of policy announcements signalling commitments towards reforms can make a difference and sustain investor interest in the renewed India story that will sustain the rupee strength.

Deficient monsoon expected in Maharashtra, Madhya Pradesh, Punjab, Haryana, Rajasthan and Uttar Pradesh along with the Himalayan states would add to the woes of the Indian economy, said Assocham. It noted that the Khariff sowing so far has been significantly less than last year raising prospects of pressure on prices of food products.