The Reserve Bank of India, in its latest review of monetary policy, mentioned high rate of inflation as its biggest concern. Both the food price inflation as well as consumer price inflation showed a general figure of double digits.

Even the non-food inflation is on the rise and there is a huge pressure on the demand.

Meanwhile the economic growth of the country is fast consolidating and becoming broad-based in India. The constraint in capacity coming out in the various sectors is becoming an increasing concern.

The WPI inflation is in double digits since February, the headline inflation hit 10.6 percent in June, while the inflation figures for March and April also soared upwards. In fact, there is high chance that when the data for May and June are revised the inflation will show higher figures that estimated.

Moreover, the inflation of primary food articles is still in double digits. Even non-food items had inflation as high as 10.6 per cent in June which in November last year was near zero. Also, non-food items contributed a significant 70+ percent to WPI inflation. Impliedly, inflation has indeed become much more generalised.