NEW DELHI, Dec. 7 -- In its bimonthly statement released on December 5, 2018, the Monetary Policy Committee (MPC) of the Reserve Bank of India forecast a benign inflation scenario. The consumer price index (CPI), India's benchmark inflation measure, is expected to be in the range of 2.7%-3.2% in the second half (October-March) of the current fiscal year.

The forecast is comfortably below the 4% target in the inflation targeting framework. This has generated hopes of a rate cut in the next MPC meeting. Lower interest rates can provide tailwinds to investment and private consumption demand in the economy. This is good news. The numbers also point towards an intensification of rural distress, though.

Here's why.

The headline CPI number is ...