Due to the gross domestic product growth, which has already put an end to the three year of growth that was in the range of 9%, the high prices will not come down soon. The fact was reveled today by the Prime Minister’s Economic Advisory Council (EAC).

The EAC’s forecast is lower than RBI’s forecast of 8 percent estimate. It is also in line with several other forecasts that have estimated growth at between 7.5 and 8% in 2008-09.

“I am confident the GDP growth will be close to 8 per cent this year,” as said by Finance Minister P Chidambaram, when he was asked to comment on the present state of EAC forecast.

The adverse impact of global environment on India has been of major concern with EAC, as it said, “Factors inimical to growth included the sharp rise in global commodity inflation, especially food and crude oil, and tightening in credit and equity markets following the subprime loan crisis in the US.”

C Rangarajan, who was the chairman of chairman of the council till earlier this week, reported, “It is still possible for inflation to climb further up. It could touch 13 per cent, but by December it will start declining and possibly moderate to 8-9 per cent by March 2009 with coordinated policy action.”