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India not out of inflation woods - Rajan

Reserve Bank of India (RBI) Governor Raghuram Rajan reads the bi-monthly monetary policy statement at a news conference at the RBI headquarters in Mumbai April 1, 2014. REUTERS/Danish Siddiqui/Files

MUMBAI (Reuters) - India's central bank will continue to focus on targeting inflation and cannot drop guard, Reserve Bank of India Governor Raghuram Rajan said in an interview to CNBC-TV18 on Thursday.

"This is where we cannot relax our guard quickly, we cannot say we are out of the inflation woods," Rajan said, referring to the central bank's achievement over bringing down retail inflation sharply from double digit level.

"This is the time we have to consolidate and ensure that the disinflationary perception is entrenched."

India's consumer prices index fell to 5.37 percent in February from a high of 11.16 percent in November 2013, a few months after Rajan assumed office.

Appreciating the government's efforts on fiscal consolidation over medium term, Rajan said the government was collaborating on the central bank's inflation target.

The RBI targets inflation at 6 percent by January 2016 and 4 percent for 2017/18.

(Reporting by Neha Dasgupta and Swati Bhat; Editing by Gopakumar Warrier)