Inflation is still uncomfortably high in India and the new government should avoid fiscal slippage as it seeks to revive the economy, the World Bank’s India director told the media.
The comments came after Indian Finance Minister Arun Jaitley warned of tough measures in his first budget on July 10, saying “mindless populism” needs to be checked as India aims to boost growth.
“It’s really important to underline that it (inflation) is a long-term threat to the economy,” Onno Ruhl said in an interview late on Wednesday at the World Bank’s New Delhi office.
“I wouldn’t advise higher deficits … it is very possible to stimulate growth without letting go of the deficit.”
