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While wholesale price inflation estimates fell to a three-year low of 6 percent in February, prices of staples such as wheat and rice were up 20 and 18 percent over the previous year, threatening an estimated 825 million people in India
-- more than two-thirds of the population -- who live on less than $2 per day and spend most of their money on food and fuel. The bank also expressed concern about the country's current account deficit, which hit a record 6.7 percent of GDP in the quarter ending in December as once-healthy exports stalled and imports surged on high oil and gold prices. Large current account deficits can weaken a country's currency and also leave the economy vulnerable to external market downturns. India's central bank says anything above 2.5 percent of GDP is unsustainable.
[Associated
Press;
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