By Suvashree Dey Choudhury and Manoj Kumar MUMBAI/NEW DELHI (Reuters) – Reserve Bank of India (RBI) governor Raghuram Rajan has set himself a target of lowering consumer inflation and is even ready to raise rates to achieve it, risking friction with the new government if he is seen as overstepping. Rajan, well known within the RBI for pragmatism, now must work with the government of Prime Minister Narendra Modi, which understands the need for – and wants – lower inflation, but doesn’t see the value in hard targets. The governor’s people skills may be tested when Finance Minister Arun Jaitley attends Sunday’s RBI board meeting in Delhi, representing a government that is equally keen on boosting an economy that has just had two consecutive years of sub-5 percent growth. The meeting comes after Rajan, the star economist appointed by the previous Congress government, surprised markets after the RBI’s policy review on Tuesday by establishing in clear terms that the RBI would get consumer inflation down to 8 percent by January 2015 and 6 percent one year later.
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