Inflation Stuns Me Too

I followed the inflation rate figures, though I never understood its meaning and its affect. I was happy to find it around 3 – 4% last year. I could never realize it going up so fast. That is around 8% now. In late 60s, I experienced it, when for the first time I found that the salary that I received as manager in one of the high paying manufacturing companies of the day, was not sufficient enough to run a family. In 1967, I remember, it was difficult to get rice even if you had money. My uncle was kind enough to get permit to bring rice from Sasaram in Bihar to Hind Motor in West Bengal. I had to send some strongmen to Shrirampur railway station to bring the consignment safely up to our flat in Hind Motor.

I had another interesting memory of one of those days. One day Yamuna asked me to bring some pulses while coming home after the factory. I went to Babulal’s shop and asked for a kg of arhar dal. I gave him a currency note of Rs 20 and kept waiting for the balance. After some time, he asked, “Sir, do you require something more?” “No, I thought you shall be returning some money,” was my reply. I never knew the price had gone that high. Actually Babulal had charged a little less from me.

As a retired person for last 8 years or so, I had forgotten inflation. We were able to manage with the superannuation and some rental earnings. However, suddenly we experience the things going real costly and managing the finances becoming difficult. Without our knowledge, the expenses on vegetables, milk products, and groceries have gone high enough to add up to sufficiently unmanageable level and to make us feel short of money at month end. Other bills such as those of cells, landline telephone and Internet as well as electricity have added to the misery. Even essential maintenance cost is becoming higher on a pretext of inflation. Any one who provides even a nominal service, charges nothing less than a hundred rupees. Consultation charges of doctors are skyrocketing. I used to pay Dr. Bhalla Rs 300 per visit at Fortis Hospital. It has gone up to Rs 500. So are the prices of medicines. Why should the doctors bother about my capacity to pay? Almost all doctors these days prescribe a minimum five-six medicines and that too the costliest brands. Some friends tell me that they receive commission from the pharma companies. Even the Homeopath has enhanced his fee to Rs 80 from Rs 30 for consultation and sweet balls that he provides for a fortnight.

Coming back on vegetables and fruits, I don’t know how the sundry vendors decide the prices charged in Sunday Bazaar. They keep on shouting the prices of vegetables in ‘pau’ (perhaps 250 gms) instead of a kilogram. It is the psychological strategy of Indian origin. The opportunity prices of the vendors have no relation with the mandi prices in kilo published every day in all newspapers, perhaps for the benefits of the consumers. Even the prices at the Mother Dairy’s subsidiary Safal that sells vegetables and fruits have no relation with mandi prices.

I wonder why it be the case in India, a leading producer of fruits (32 million tonnes annually, that is 8 per cent of global production), vegetables (producing 71 million tonnes per year, a 15 per cent share of the world market), and milk (the highest in the world). While we pay about Rs 8 a kg for potatoes in Safal outlets, the farmers are going for distress selling in Agra about 200km away because of the bumper crop and no buyer because of the ban on the forward trading by the government. And then huge waste is common. As high as 40 per cent of the fruits and vegetables grown in India (that’s some 40 million tonnes-worth a staggering $13 billion) gets wasted that is enough to feed countries like Brazil and Vietnam. It is due to insufficient cold storage capacities (The current cold chain capacity in the organized sector is around 60,000 tonnes) in close proximity of farms, lack of temperature-controlled transportation and storage in the supply chain up to the retail stores.

Organized retail is certainly some answer, but excessive profit motive will hardly be helpful for the consumers or the producers. I find Biyani’s Big Bazaar as the best customer-friendly store for grocery, vegetables, and fruits. As claimed, if the organized retail outlets buy straight from the farmers, growers, and producers, it can price always lesser than the mandi. The inflation is making the consumers miserable with no gains for the farmers and producers. It is only the middlemen and traders who make money. Can the government or some effective regulator decide some relation between the price paid to the producers to the mandi price and the retail price considering sufficiently good margin for the business?

Strangely, the price gap between the MSP (Minimum Support Price) of wheat (about Rs 10 a kg) for farmers and the packed wheat (Rs 15 a kg) is not that high as other food items, say pulses. The subject requires some moral commitment from the traders, which I doubt to come. And the middle class households, particularly the lower group earning below Rs 2 lakh a year will always be under pressure to cut consumption or quality of the consumables.

I shall try that inflation does not shock me in future. It happens in every country. And one must learn to live with it, particularly when you are no more working with regular income.

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