🔍 Inflation Falls, But Unemployment Persists: A Deeper Look at India’s Growth Paradox 🇮🇳📉
India’s inflation is cooling—hovering around 3%—and that’s being celebrated as a sign of economic health.
But here’s the reality check: unemployment has risen to 5.8%, and that paints a very different picture.
A recent analysis by economists at the Centre for Development Studies makes a provocative argument:
👉 India’s falling inflation isn’t driven by RBI’s interest rate cuts—but by structural imbalances in growth, especially a surge in agricultural output while other sectors stagnate.
Their case challenges conventional thinking:
🔄 RBI’s monetary policy may be reactive—not proactive—in tackling inflation.
🧠 Inflation targeting through rate hikes might not always work in India, especially when unemployment is high.
🌾 Agriculture is outperforming, and that supply-side boost may be the real reason behind softening prices—not reduced consumption.
⚠️ What’s the point of low inflation if jobs are disappearing? For someone unemployed, cheaper goods don’t matter when there’s no income to spend.
As we debate fiscal and monetary interventions, this reminds us:
✅ Growth without jobs is a hollow victory.
✅ Inflation control must consider both demand and supply-side realities.
India needs not just price stability—but job-rich, inclusive growth.
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