National Economic Planning 2009

International Institute of Planning and Management

Excellences:Mr. Jay Sheth | Ms. Karuna Bhansali | Mr. Amar Baldva | Ms. Komal

Jain | Mr. Shashank Tripathi

Three things cannot be long hidden,The Sun, The Moon & The Truth

- Buddha

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Inflation is not on account of flawed Monetary policy

Avowers Think Tank

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Flow of presentation Charge - Inflation

Considered culprit – Monetary

Proof for Innocence Major Culprits

Proffer

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Meaning of Inflation

A general increase in prices of all the Commodities

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Types of Inflation

Demand Pull Inflation

Cost – Push Inflation

Pricing Power Inflation

Sectorial Inflation

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Measurement of Inflation

Wholesale Price Index (WPI)

Consumer Price Index (CPI)

Gross Domestic Product (GDP) Deflator

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Monetary

A credit policy through which RBI seeks to

ensure price stability in the Economy.

Controls the supply of Money, the Cost and the

Availability of credit in the country

A policy statement traditionally announced

twice a year

Slack season Policy ( April – September )

Busy Season Policy ( October – March)8

Tools of Monetary PolicyCash Reserve Ratio

Repo Rate

Reverse Repo Rate

Bank Rate

Statutory Liquidity Ratio9

Objectives of Monetary Policy

Stability of Exchange Rates

Price Stability

Neutrality of Money

Economic Growth with Stability

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CRR and Inflation Rate

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Source : Bhattacharya K. and I Bhattacharya

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Major CulpritsBlack Money

Global dependency

Fake Currency

Fiscal Policy

Export

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Black MoneyBlack money is measured approx. 40% of GDP

Political Corruption

Controls in licensing system

Tax structure

Public Sector

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Global dependencyShortages of vital raw materials 

 Reliance on generators powered by expensive imported Fuel

We are dependent on oil and oil prices

(What is worse is that even some of the oil that is pumped out of Indian soil (as in Rajasthan by Cairns Energy) is costing India 20 times its actual production cost.)

Source- www.india_tripod.com

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Fake Currency

61,000 million fake pieces valued at Rs. 1,69,00 corers

in circulation Source :The Hindu

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Fiscal Policy

Non-planned expenditure had increased from 59.90% in 1980-85 to 75.75% in 1998-99 of total expenditure

In 2005-06, India's federal council of ministers ran up a non-planned expenditure bill of $45 million The ministerial tab for 2008-09 is $50 million

Source :Indian economy since independence - Uma Kapila

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Export Steel manufacturers like the Tata's had cautioned

against run-away exports of iron - ore and they too were ignored.Steel Prices shot up in Mid 2008

Companies like Reliance, exports fuel in African nations in spite of shortages in India.

India has more than 35% population who hardly get food once a day and therefore at this juncture exporting very essential products like Rice and other edible items should not be exported 

Source-www.india_tripod.com18

Proffer

Control on Black money

Fiscal measures

Alternative solution to global crisis

Enlighten policies

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The End

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