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The Finance Ministry expects the inflation rate to begin falling in December (data for which will be released in January 2012) and then continue down a steady path to 7 per cent by March 2012.
It is expected to moderate further in the first half of 2012-13, Mr Gopalan said.
“The fact that even as inflation has persisted, growth has not dwindled and has held up in the face of some severe demand compression far. But what is important is that the drivers of future growth namely investment are getting affected and capacities are going down. The sooner the inflation eases the greater the chances of salvaging the investment rate and anchoring medium-term growth prospects,” Mr Gopalan said.
He felt that with inflation moderating, the focus would revert to supporting growth and it should be possible to get back to the higher growth trajectory sooner.
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