Missed on inflation forecast, govt's credibility at stake: Montek

The stubbornly high inflation has hurt the government's credibility and if not curbed in a couple of months, it would send a signal that the policymakers are clueless in controlling the menace, Planning Commission Deputy Chairman Montek Singh Ahluwalia said on Sunday.

"It is true that inflationary pressure is higher than what we had thought it would be... It's absolutely true that we have been hoping that this would happen earlier and to that extent our credibility becomes questioned," Ahluwalia said in an interview to a private news channel.

He said the government was hoping that inflationary pressure would ease from the beginning of next year.

"By February you will have the January data and if it turns out that inflation is not coming down by then, then we really don't know what we are doing," Ahluwalia said.

SPECIAL: Will savings rate deregulation help against inflation?

The Planning Commission deputy chairman hoped that inflation would come down to 7-7.5 per cent by March next year.

Overall inflation has remained stubbornly high, near double digits, since January 2010. Headline inflation based on the wholesale price index was recorded at 9.73 per cent in October. Food inflation was recorded at 10.63 per cent for the week ended November 5, according to the latest official data.

Top policymakers, including Prime Minister Manmohan Singh and Finance Minister Pranab Mukherjee, had projected that inflation would come down to a comfortable level of around 6 per cent by the end of this calender year.

The Reserve Bank of India has increased its key policy rates 13 times since the beginning of 2010 to curb inflation, without much success so far.