Some others have argued that, at 16 per cent, the growth in the money supply would imply an inflation of 10 per cent if GDP grows at 6 per cent. The money supply growth indicated here is in terms of broad money and not narrow money.
The income elasticity of demand for broad money which has been proven to be reasonably stable and is in the range of 1.5 to 1.6 in India should be taken into account.