Will India have to sacrifice growth for curbing inflation?

The Reserve Bank of India (RBI) has traditionally stood apart from its peers. It is therefore hardly surprising that its monetary policies should follow a contrarian route as well. Not just the US Fed, Bank of England and the ECB, but even the Chinese central bank has eased liquidity in recent months. All in the chase of higher growth rates. However, for RBI, the focus has been on curbing inflation. In the past, it did make an attempt to balance inflation and growth rates. But eventually that became impossible. Especially with the government unwilling to cooperate on the debt control front. Hence, the RBI has now decided to let the axe fall on growth rates. Governor Dr Subbarao has emphasised on the necessity to sacrifice growth to tackle inflation. What it means is that the government and the central bank are on tangential directions when it comes to steering the economy. Only time will t ell, which of them will succeed in liberating the economy's growth from inflation contagion.