Announcement on price control and Punjab 

October 17, 2025

Abhishek Vij

Despite not reducing the repo rate in the recent monetary policy, the Finance Minister of India and the Reserve Bank of India announced that inflation in the country has been brought under control. The Reserve Bank considers a safe rate of retail inflation below 5 percent. The government announced that the retail inflation rate has fallen below this level. Subsequently, on October 14th, a further statement was issued, stating that the wholesale inflation rate has also fallen significantly. The next step will be to focus on increasing the country’s growth rate.

Therefore, the repo rate may be reduced in the next monetary policy announcement. Now we turn to Punjab. Punjab’s economy has been severely shaken by the adverse effects of unusual weather. On one hand, the overall productivity and quality of the paddy crop in the fields have been adversely affected, and on the other hand, urban businesses have also been hampered due to transportation disruptions. Despite this, now that the festive season has begun in Punjab, a major relief has been announced that the inflation rate in Punjab has declined. It fell to 3.06 percent in September, compared to 3.51 percent in August. The central government claims that this inflation rate decreased due to a reduction in GST rates. Inflation in Punjab also declined for the same reason. We want to assess its veracity.

It is being said that Punjab has received relief from inflation due to the reduction in the prices of food items, vegetables, and fruits. However, when we count the five states with the highest inflation rates in the country, Punjab is among them. Kerala has the highest inflation rate, followed by Jammu and Kashmir, Karnataka, and then Punjab. On the other hand, Punjab is burdened with debt. In 2024-25, Punjab’s debt was Rs 3.82 lakh crore. It is estimated that this burden will increase to Rs 4.17 lakh crore next year.

Still, it is being said that Punjab’s economy has recovered due to improved GST collections and a decrease in inflation. If we look at Punjab’s Consumer Price Index (CPI) during September, it certainly didn’t jump, but from 191.6 in August, it rose to 192 in September. The common man is troubled by the fact that government indexes declare inflation under control, yet every essential commodity is available at the same price or with a slight increase. Why is this a contradiction? Looking at the situation in Punjab and Himachal Pradesh after the floods, we can see the impact of inflation on the common man.

The recent floods have affected 500,000 acres of cultivable land in Punjab, destroying basmati, fodder, and vegetable crops. This situation will persist until the new harvest arrives. In Himachal Pradesh, 24,292 hectares of agricultural land have also been damaged. Crops have been destroyed, and the government, which claims to be tackling inflation, is being told by market assessments that the burden of inflation has increased on the food plate. Vegetable and grain prices are skyrocketing. In such a situation, when the common man finds his plate of bread becoming expensive, then how can we believe that inflation and price rise have been controlled, and the common man has got relief from inflation?