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The news that the south-west monsoon has hit the Kerala coast on time augurs well for the management of inflationary expectations. However, the monsoon alone cannot douse inflationary fires. Apart from much-needed fiscal stabilisation, mentioned above, the government needs urgent policy reform. The task at hand has to be handled by both the central and state governments, as correctly emphasised by the Reserve Bank of India in its meeting with state finance secretaries.

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