Vol. 1, Issue 2, Part C (2015)

Abstract
Inflation is a burning issue for most developing countries in today’s times. This is especially true for India especially in the post reform era. On the one hand it has its negative impact as it affects the purchasing power of the people. On the other hand economists have also argued that it is impossible for growth to occur without certain levels of inflation. Thus, it becomes imperative for the government, the lawmakers and the economists to study this issue and suggest policy measures to keep it in check so as to balance the positive impact and counteract the negative ones.rnAccording to statistical data inflation in India is higher specifically in food items. Causes for this are both demand side as well as supply side. Inflation in food items specifically impacts people in a harsher manner relative to all other commodities. It reduces the purchasing power of people which impacts on the savings of the people also. This paper explains about as per given statistics, the agricultural productivity and sophisticated techniques and reforms in retail industry which helps to protect people from inflation. Government polices like monetary policy and industrial policy should be prepared in such a manner which decreases inflation in India.