Recent discussion paper from RBI initiates the second five-yearly review of India's FIT framework.
- FIT framework was established in May 2016 through an amendment to RBI Act, 1934, with a mandate to maintain price stability while keeping in mind the objective of growth.
Overview of India's FIT Experience (2016-2025)
- From the inception of the FIT in 2016 till about the end of 2019, inflation in India remained low and stable, averaging around 4 per cent.
- Inflation breached the target (4 ±2%) in the 2020s due to food and fuel shocks amidst pandemic and Russia-Ukraine conflict.
- Inflation subsequently receded by targeted supply-side interventions, anti- inflationary monetary policy, and falling international commodity prices.
