Taming inflation is govt's top priority, says FM Sitharaman

India's retail inflation shot past estimates to hit a 15-month high of 7.44% in July

- Rhik Kundu

The Union government's priority is to tame inflation for sustained economic growth, though elevated interest rates may act as a dampener to global economic recovery, finance minister Nirmala Sitharaman said on Friday.

Persistent high inflation will crimp demand, Sitharaman said and added that the tendency to use interest rates as the only solution to tackle inflation has its own downside. She was speaking at the B20 summit, a gathering of top business executives from G20 countries.

"Central banks will have to keep in mind growth and growth-related priorities along with controlling inflation," she said. "Obsession to use interest rates as the only tool to deal with inflation and not manage the supply side factors will not give a complete solution for inflation."