Rajasthan records India's highest inflation of 9.7% in July

Retail inflation in Rajasthan has surged to become the highest in the country, offsetting the relief efforts extended by the state government through 'Mehangai Rahat Camps' (inflation relief camps). As per a TOI report, Rajasthan recorded the highest retail inflation rate of 9.7 per cent in July, closely followed by Jharkhand at 9.2 per cent. The sudden spike has been attributed by economists and consumer protection bodies to disruptions in vegetable supply, election-related expenditures, and the low base effect.

Economists have highlighted that the adverse impact of the recent rise in retail inflation can be attributed to the disruption in vegetable supply chains caused by rains. The effect extends beyond tomatoes to encompass various vegetables, including ginger, that have witnessed price hikes in the past few months. Professor ND Mathur, Dean of Jaipur School of Economics, told TOI the impact of the dry spell in August on vegetable crops, suggesting that prices may not revert to normal levels in the upcoming months due to deficient rainfall.

Further exacerbating the situation was the assembly election period, which resulted in increased liquidity in the state. Professor Mathur explained that during election times, additional cash flow into the hands of the public leads to heightened demand which drives up prices. The recent decision by the law ministry to raise the maximum poll spending limit for candidates has also contributed to the inflation surge.


The implementation of welfare measures has injected more money into the hands of the people. The state government's inflation relief camps provided subsidies on cooking gas, electricity, health insurance, and hospital treatments, among other benefits. Consequently, this infusion of funds into the economy has contributed to the overall inflationary pressure.

In July, rural retail inflation measured by the consumer price index surged from 5.11 per cent to 9.30 per cent, while urban inflation soared from 5 per cent in June to 10.90 per cent. According to data from the National Statistical Office, the retail inflation breakdown included 37.43 per cent attributed to vegetables and 13 per cent to cereals and related products.