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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