Pranab Mukherjee, while responding to a debate on the opposition-sponsored debate on inflation, on Wednesday said rising prices were a cost of rapid expansion of Asia's third-largest economy.

The wholesale price index , the country's most closely watched inflation measure, rose 10.55 percent in June and is expected to record a double-digit rise in July for the sixth straight month.

The rupee is fully convertible on the current account but is only partially convertible on the capital account and top policymarkers have repeatedly emphasised that the capital account must be opened up only gradually.

In its monetary policy report for the second quarter, the bank also said that China will see considerable net forex inflows but repeated that there is no basis for big swings in the exchange rate of the Chinese currency and the yuan will be kept basically stable at a reasonable, balanced level.