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This article investigates the existence of a threshold level of inflation and how any such level affects the growth of Indian economy. The article also seeks to examine the dynamic short-run and long-run relationship between inflation and economic growth in India. By employing spline regression method to estimate the threshold level of inflation and the long-run and short-run relationships, the results show a statistically significant structural break in the relationship between inflation and economic growth at 4 per cent. The study suggests that if inflation exceeds the threshold point, that is, 4 per cent, it will negatively affect economic growth. The autoregressive distributed lag (ARDL) model bound testing cointegration suggests that there are two cointegration vectors when gross domestic product and rate of interest are considered as the dependent variables. This result confirms the existence of the long-run equilibrium relationship between economic growth, inflation, exchange rate and rate of interest. From the long-run analysis, the study found that inflation is positively related to economic growth, whereas the other variables are not significant. JEL Classification: E4, E6

The present study examined the linkage between energy consumption and economic growth in India uses the annual time series data covering the period from 1970-71 to 2011-12. The study used Gross Domestic Product as a proxy for economic growth and energy consumption (oil equivalent per capital). The empirical findings of the study suggest that there is both the short run and the long run relationship exist between energy consumption and economic growth. The Granger causality result confirms that there is unidirectional causality running from economic growth to energy consumption. That means the study support the conservation hypothesis. The impulse response result of the study suggests that India requires an alternative source of energy for faster economic growth. The variance decomposition of the study concluded that the rapid growth of the economy depends on the heavy energy consumption. From the policy recommendation point of view, the energy policy of India should give more importance to find out the alternative source of energy supply in order to meet the growing demand for energy. Moreover, to achieve sustainable energy conservation and macroeconomics stable India should follow the energy efficiency and selfsufficiency in energy production for faster economic growth.

The present study investigated the inflation growth nexus in the context of BRICS countries. The study used time series data covering from the period 1980 to 2012. The data sources are cumulated from the World Bank, World Economic Outlook (WEO). The empirical findings of the study indicate that a long run positive relationship between inflation and economic growth only for China and South Africa at the 5 percent level of significance. The study also found that there is a unidirectional causality between economic growth and inflation in the context of India whereas; bidirectional causality takes place in the case of China. The VAR analysis could not find a consistent short run relationship between inflation and economic growth over ten years ahead for BRICS countries. From the policy implication point of view the study suggests that policy makers in BRICS should consider the short run relationship between inflation and economic growth while, the China and South Africa policy makers should pay attention to both short run and long run relationship.

The present study investigates the dynamics of inflation, GDP and exchange rate and money supply in India for the period Contribution/ OriginalityThis study is one of very few studies which has investigated the growth inflation relationship in the context of India in a new approach using VAR model.