The IMF has released figures showing that inflation is not related to a growing economy ( Times of India, March 7, 2011 ). China grew by 11.4% between 2005 and 2009 but inflation was only 2.7% whereas India grew by 4.7% from 1990 t0 1994 with inflation at 10.2%. The article does not discuss other factors possibly contributing to such figures for example China's one child policy which could have reduced demand and India's exorbitant tax rates fueling rise in prices. To combat inflation interest rates were raised so high that banks were offering 14.5% on fixed deposits but this would have been counteracted by falling tax levels due to WTO rules so that from 1995 to 1999 growth was 6.8% with inflation at 8.9% in India. High interest rates with the dot com crisis led to a crash in property prices which brought inflation down to 3.9% from 2000 to 2004 but the economy still grew at 5.6% but low interest rates created a property boom raising inflation to 7.2% with growth at 8.2% from 2005 to 2009. The reason is that rise is property prices mirror rise in black money which is beyond the control of the Reserve Bank. Today inflation is being blamed on increased demand for food due to rising prosperity but daily calorie intake in rural areas has declined by 5% in 2004-05 compared to 1993-94. The RBI has been raising interest rates timidly to control inflation but has failed so far. Today we learn that industrial growth has fallen to 3.7% in January. Unless the RBI raises interest rates to reduce property prices by 70% inflation will remain out of control. High inflation reducing demand or high interest rates reducing output, that is the choice. Tough.