AN INCREASE in the cost of funds for borrowers appears imminent with finance minister P Chidambaram announcing the government's willingness to sacrifice growth for lower inflation. The finance minister on Friday said the government would curb price rise through a combination of fiscal, monetary and supply-side measures. Responding to the 6.68% rise in the wholesale price index, Mr Chidambaram said, "I assure you that the government is determined to take fiscal, monetary and supply-side measures to tackle inflation. If that means we have to live with a slightly lower growth rate, so be it.' Speaking at several events in Mumbai on Friday, the finance minister repeatedly referred to a growth target of 8%. He said he expects the economy to grow at this rate in the current quarter and continue to grow at this rate in the next fiscal. Speaking at an Indian Merchant's Chamber event, Mr Chidambaram virtually admitted that imports alone would not curb inflation. "A country as large as India can never be dependent on importing food. We have to be nearly self-sufficient in every item we consume. Last year, we imported small quantities of wheat. This year, can we import wheat? Every country in the world has banned exports, even if we want to, we cannot import wheat.' Monetary tightening is also likely given that the government is worried about rising inflationary expectations. "We also have to curb inflationary expectations. When wholesalers or retailers hoard wheat or rice, they are feeding inflationary expectations,' he said. One way to bring down inflationary expectations is to increase the cost of funds and thereby make it difficult for traders to hoard commodities in hope of better prices. Speaking on the sidelines of the event, HDFC chairman Deepak Parekh said interest rates could go up because of inflation. While the FM referred to interest rates, money markets also expect the Reserve Bank of India to use an even more blunt instrument