Inflation is high but we will overcome: Chidambaram

Chennai: Expressing concern over high inflation, Union Finance Minister P Chidambaram today expressed confidence in meeting the challenge and overcoming it "as had been done in the past." Addressing a gathering after the foundation laying function for Indian Bank's new head office building, Chidambaram said "when the economy is growing at nine per cent, it is a very different game. Credit will expand, money flow will increase and foreign investments will come resulting in inflation going up."

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"Besides, oil prices have risen dramatically and prices of commodities like lead, zinc and copper have gone up. However, we can meet and overcome the challenge. What we have to do is to follow what expert economists have suggested over a period of time and deal with the situation."

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"In 1997-98 we had the Asian Economic Crisis, in 1980-90 India was facing a serious foreign exchange problem, during 1979-80 the inflation was around 24 per cent and in 1973 there was the first oil shock.

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"But we have come out of it and we will come out of the present crisis also. Changes in fast expanding economies create problems in developing countries. We have to deal with the situation with patience, policy and courage," he added.