The price hikes during Covid were more because of supply chain and logistics disruptions caused by the pandemic and the Ukraine war rather than firms increasing prices because of higher pricing power, a report by State Bank of India (SBI) said. It is thus incorrect to infer that concentration power dictated pricing capacity of firms, thus resulting in unyielding core inflation, the report authored by Soumya Kanti Ghosh, group chief economic adviser, SBI, said.
A recent research article by former Reserve Bank of India (RBI) deputy governor Viral Acharya had observed that persistence of core inflation in India is due to purchasing power of top-five corporate houses.
In March, Acharya - formerly a deputy governor of the RBI - had said in a paper that India s core inflation was persistent and elevated due to the pricing power of its large firms and recommended they be broken up
India is set to overtake China and become the world s most populous country by the middle of 2023. And while a growing population also creates a large pool of working-age people, the demographic dividend can only be reaped when they are employed
The immediate storm set off by the SVB collapse may have passed following another bailout, but questions are being raised about whether this was just a passing phenomenon or the sign of much worse to come.
The former RBI deputy governor sparked a controversy by calling for the breakup of India’s largest firms in a recent paper. But his views on how the country’s smallest businesses will benefit from digitalisation are far more interesting