Cannes, Nov 4: Admitting that inflation is a problem, Prime Minister Manmohan Singh today said price rise is also a sign of growing prosperity to some extent.
“This (inflation) is a reflection of demand exceeding supply, to some extent it is a sign of growing prosperity of the country,” Singh said here in a press conference on the sidelines of the G-20 meet.
“If our national income is increasing at the rate of 8 per cent per annum and population is increasing at the rate of 1.6 per cent per annum. So, the per capita income of country is growing at 6.5 per cent to 7 per cent. It is bound to lead to demand for more diversified food basket,” he added.
However, Singh also conceded that “inflation is a problem”.
The headline inflation measured in terms of wholesale price index (WPI) has been above 9 per cent mark since December last year and stood at 9.72 per cent in the month of September.
Food inflation rose to 12.21 per cent for the week ended October 22, despite the steps taken by the government and the Reserve Bank to check the price rise.
