Critically analyse inflation dynamics in India, highlighting measurement issues, sources, policy trade-offs and a medium-term strategy to maintain price stability with growth. (Answer in 250 words)

Inflation—the sustained rise in the general price level—alters real incomes, redistributes wealth and complicates macroeconomic management. India’s recent experience shows episodic food-fuel spikes amid a broadly anchored core, posing difficult policy trade-offs.

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