Calling current econ situation as stagflation a misnomer: Madan Sabnavis

There are many speculations about the state of Indian economy presently doing the rounds, with some are calling the current situation of rising inflation, slowing growth and high unemployment as stagflation. But chief economist of Bank of Baroda, Madan Sabnavis, in an exclusive conversation with Business Today, has said that we are not at all caught in a situation of stagflation and that using such a term is  a misnomer.

" Stagflation means negative growth in two successive quarters and high inflation. We are nowhere in the negative GDP growth region, which we had it during the lockdown but not after that," Sabnavis said.

Stagflation is a situation in which the inflation is high, unemployment is high and growth is low. According to him, even if the inflation inches up to 8 per cent, still it is not scary.

"All the fears which people had about crude oil price going to $140-150, somebody said $400 per barrel, have all been put to the rest. Today, we have seen that equilibrium would be around $110. So I do not think that there's going to be any more upsurge in terms of price," he added further.

Also read: Inflation getting broad-based, RBI set to hike repo by another 1% in FY23: Report