Inflation at a rate of 4-5 pc not a big threat: Jalan

NEW DELHI: Former RBI Governor and Rajya Sabha MP Bimal Jalan on Saturday said inflation rate of 4-5 per cent and the problem of excessive supply of money is not a serious threat to Indian economy.

"Higher rate of inflation and the problem of excessive liquidity can be managed without taking much harsher steps," Jalan said while speaking at an interactive session organized by the Indian Management Institute here.

"In a situation where the country had a good monsoon, healthy forex reserves and reducing fiscal deficit, inflation at rate of 4-5 per cent did not pose a great threat to the growth of economy," Jalan Said.

When asked about whether RBI should go for another hike in CRR, he said, "I would not comment on the matter as RBI is soon going for its periodical monetary policy review and it could lead to market speculation."

Commenting on the public services in the country, he said, "Providing quality public services such as health, universal primary education and other such amenities to larger section of population is the real challenge today."