Now, the Modi Government has to tackle 'this' new challenge!

Increased retail inflation increases concern for the Modi Government

SEP 11 (WTN) - You are a direct witness of how much damage has been done to the country's economy due to the Coronavirus infection epidemic. The shutdown of economic activity due to a long-term lockdown has recorded a negative decline in the GDP growth rate in the first quarter of the current fiscal year 2020-21, where the lockdown has resulted in millions losing jobs. At the same time, there was also a huge loss in industry and trade. And, due to all this, the Modi Government is facing opposition from the general public as well as the opposition parties.

However, economic activity is gradually increasing after the lockdown opens. But, now, the budget of the common people is getting disturbed due to the continuous increase in the retail inflation rate. First of all, for your information, let you know what is the inflation rate? In fact, in Indian markets, inflation is generally referred to as fluctuations in the prices of commodities for some time.

Generally, when the prices of goods or services in a country are higher than the normal, this situation is called inflation. It is now natural that as the prices of goods and services increase, people will buy less expensive items. At the same time, public will use less expensive services. That is, inflation is a way of measuring the availability of currency in the market and the rise in the prices of goods and services.

Now, on the basis of this inflation rate, many decisions of financial and monetary policies are taken in India. However, after the lockdown opened, the supply chain has been severely affected due to a spurt in the Coronavirus cases, which has led to a spurt in the prices of daily necessities. At the same time, heavy purchases have also been made by the government, due to that the prices have increased. Here, according to a recent report by SBI EcoRap, inflation data based on the Consumer Price Index may remain at 7 percent or above in August.

At the same time, the latest report released by the State Bank of India has stated that the retail inflation rate will now come down to 4 percent only after the month of December. As for the retail inflation rate in July, it was 6.93 percent. But, at the same time in July of last year 2019, this figure was only 3.15 percent. According to experts, this rise in the inflation is due to increase in the prices of cereals, pulses, vegetables, and meat-fish, etc.

According to the SBI report, the infection of COVID-19 is now increasing rapidly in rural areas. In such a situation, the supply of food grains, vegetables, and fruits, etc. are coming from the rural areas. At the same time, less rain at some places and more rain at some places has affected the production of grains, vegetables, and fruits. In such a situation, it will take some time for the supply of items other than these to be restored well. In such a situation, the government is in the danger of increasing inflation.

By the way, for your information, let you know that the government has given the responsibility to the RBI of keeping the inflation around four percent with a maximum of two percent ups and downs. Now, the supply of goods is getting stalled due to Coronavirus and other reasons, the rise in the retail inflation is natural. At the same time, if this happens, till the situation becomes normal, the Modi Government will have to face the resentment of the people of the country and opposition from the opposition parties on the issue of inflation.