An Economic Analysis on Historic Inflation Rate in India

  • P Karthikeyan Assistant Professor, School of Management Studies, Kongu Engineering College, Erode, Tamil Nadu, India
  • M Manikandan Assistant Professor, Department of Economics, Sri Vasavi College, Erode, Tamil Nadu, India
Keywords: Inflation, GDP, WPI, CPI-IW, Economic reforms


India's inflationary experience was a varied basket. There were some years the annual inflation rate reached a maximum of 40%, while other years were negative. Wholesale price index, differs in a wide range as the lowest value of -12.5% for the year 1952-53 and the highest amount of 38.3% for the year 1943-44. The highest value is due to the end of the world war-II. The years of high, inflation is mainly the impact of War, low agricultural production due to drought and oil price hike up in foreign countries. The inflation rate was below 6% for 38 years and above 6% for 40 years out of 78 years beginning from 1939-40 to 2016-2017. Suppose, it is assumed that India's bearable rate of Inflation is equal to or below 6%, then, India appears to be worst in controlling inflation.

On the other hand, the rate of inflation above 6% to 15% was for 31years and above 15% for nine years. Therefore, many accept as accurate that India is to be an Inflation driven country. The severe economic setback in the Indian economy is inflation, which hinders the economic power of the people. Most of the people are still suffering due to increase in India. These major study aims to support the Government, and economists should generate better policies for the control the rise.

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