Indonesian government would take efforts to rein in inflation below 5 percent as the economic growth is expected to reach 6.5 percent this year, Coordinating Economy Minister Hatta Radjasa said Thursday.
He added that besides taking orchestrated efforts to control inflation at that level, the government would also make efforts to reduce budget deficit to below 3 percent.
He said that that due to the parliament's rejection on the policy last month, the government is reorganizing the several posts in the budget with intense discussions in the cabinet are underway at the moment.
Among the efforts considered by government to reduce inflation was by limiting the consumption of subsidized fuel in the public.
A senior official at the central bank (BI) said earlier that if the subsidized fuel limitation is applied to all private cars, there will be 0.7 percent inflation addiction.
"If the policy is applied on cars with certain engine capacities, the policy is insignificant in affecting inflation," Perry Warjiyo, BI Director of Economy and Monetary Policy Research section said in earlier reports.
If the subsidized fuel consumption is applied on private cars, he said that inflation may reach 4.7 percent with growth at 6.4 percent.
Indonesia posted positive growth of 6.5 percent last year with inflation recorded at 4.5 percent amid slowdown lingering global economy. |