http://online.wsj.com/news/articles/SB10001424052702303932504579254214290446386
Over the past year, India has been raising its rate of inflation in order to expand its economy, but this method is starting to become a real issue. The reason for this is that many Indian workers live near or below the poverty line, and their wages are not increasing fast enough to keep up with this rising inflation. As a result, these workers are having more and more trouble purchasing basic necessities, which is causing harm for the economy.
Retail inflation, measured by the Consumer Price Index, has risen all the way to 11.24% in November, which was higher than expected and unanticipated as well. In my opinion, India should attempt to curb its inflation and maintain steadier levels of inflation for the time being in order to alleviate economic pressure on its impoverished workers. Also, a steadier rate of inflation will ensure steadier economic growth.
I agree with you. I also did an article about India. They are having a hard time purchasing necessities so the economy is being hurt rather than expanding. India should really keep inflation at a certain rate.
ReplyDeleteIn my opinion India is trying to keep up with Chinese growth. They're both in a boom right now and its kind of a technological rivalry. Sort of lol. I think that if India keeps it up they will just have increased wealth distribution, more polarized hierarchies, and more unhappy citizens.
ReplyDeleteAs events in the past have shown, inflation can quickly get out of hand (just ask Zimbabwe). I understand this is a situation of economic growth and not during a struggle, but the concepts should remain the same. If the country lets inflation get too out of hand, they could end up in a situation that could take a long time to escape from.
ReplyDeleteI can't say that I know of any government that was trying to raise it inflation in order to grow the economy, and I would like to meet the government leaders who decided it was a good idea. Obviously a country should have some inflation but the 11.24% that was mentioned is way to high. I think that the Indian government is a little inexperienced with the booming economy they currently have and so the mismanagement is not as apparent to them as quickly as it is to us.
ReplyDeleteAs one of the fastest growing nations, expanding the economy should be a relatively simple process, however, raising the inflation should not be the solution because they should take into account peoples' income.
ReplyDeleteIndia has a lot of economic problems stemming from various actions of their government. They have failed to keep infrastructure up to date. that has in many cases made costs higher for the companies operating there. At the same time the government is making the Rupee worth less and less due to their economic policies. They are just hurting themselves
ReplyDeleteIndia needs to try to grow its economy slowly and steadily. 11.24% inflation is crazy. No wonder people can't afford even the basics. India is populated that I can't imagine many people can keep up with the growing rates. I don't know why that sounded like a good idea to anyone.
ReplyDelete@Ben Stahp. We do that bud. We learned about it in class. Sometimes governments do raise inflation in order to grow the economy. I think it's naive and somewhat classist of you to declare that the Indian government is "a little inexperienced with the booming economy they currently have and so the mismanagement is not as apparent to them as quickly as it is to us."
ReplyDeleteDo you really think it's just some random people sitting around just guessing at solutions? Obviously not. They have world-class economists advising their government, just as we do
I agree that the inflation is too high, and that it needs to be controlled. But clearly if a bunch of high schoolers in an intro econ course can figure that out, I assume the Indian government knows about it too.
In my opinion, India is a larger country and hence them trying to expand, you're going to need to inflate currency of course; the question is how much do you inflate by. Obviously India didn't inflate just so they could be in a larger problem. I thin they just got ahead of themselves, by a ALOT.
ReplyDeleteI think it's great that India is attempting to expand and develop its economy. With over 1 billion people, India could become a powerhouse of production. This could help get many of its people out of poverty which, from what I understand, is a huge problem over on the Indian subcontinent. However, along with China, India is setting itself up to compete with the United States on a global scale, which might not be good for American jobs.
ReplyDeleteWhile I agree that the inflation that India is experiencing is a bit too much, I don't think that this will turn out to be any more than a small speed bump in their path to eventual economic super-growth.