India's development to ease high food inflation: Ashima Goyal

In India, the issue of high food inflation is expected to become "less severe" in the future, according to Ashima Goyal, a member of the RBI Monetary Policy Committee (MPC).

She highlighted that modern supply chains with diversified sources can efficiently tackle sudden price spikes in specific food items. Goyal emphasized the significance of increasing agricultural productivity in policymaking, given the substantial share of food in Indian household budgets, as stable agricultural prices are crucial for achieving non-inflationary growth.

"As India develops, this problem (high food inflation) will get less severe, for a number of reasons. Modern supply chains with diversified sources respond quickly to large spikes in specific items," she told.

Goyal further pointed out that one does not hear of tomato or onion prices spiking in advanced economies.

"We naturally have diverse geographic regions, better integrated markets sourcing from different regions can help mitigate climate change induced food price spikes," she said.