Describing the present level of inflation as too high and not acceptable, Mr Pranab Mukherjee finance minister of India said that efforts have to be made to bring it down to 5 to 5.5%. However, he expects inflation to moderate and come down to 6 to 7% by March next.

Mr Mukherjee in an interview said that "Inflation is too high. It is not acceptable. It will have to be brought within the moderate level. Maximum in the given situation is 5 and 5.5%. That's why we are making efforts. It will have to be tackled.”

Besides international factors, the minister said, rising population, hike in procurement prices and increasing purchasing power was also responsible for inflation.

Mr Mukherjee said that “There is a gap because demand is increasing, population is increasing, and people’s income is increasing. So they will buy more and consume more adding that consumption of fruits, vegetables, egg and meat has been rising.

By end of the current fiscal, Mr Mukherjee said that the inflation would calm down to 6 to 7% from over 9% currently.

The headline inflation was 9.44% in June, much above the Reserve Bank's comfort level of 5 to 6%. It was 9.06% in May and 9.74% in April.

(Sourced from FE)