- Saturday, April 20, 2024
By: Shubham Ghosh
INDIA’S season of festivities is here but the common man is far from enjoying the times, thanks to ever-rising prices of almost everything under the sun. Diwali, India’s popular festival of lights is just weeks away but soaring prices have left people with little enthusiasm.
Suman Milind, a homemaker from Delhi, is tightening her budget and even changing her spending habits because of soaring prices of fuel, transport and other items. Stagnant incomes owing to restricted economic activities because of the pandemic have not helped things either.
ALSO READ: More than onions, their rising prices make Indians cry
“Earlier we used to get four or five boxes of dry fruits during festivals, but now we hardly get one or two. Because of the high prices,” Milind was quoted as saying by Reuters. She also said that her family has cut down the expenses on food as well by reducing meat intake to just once a week compared to several times a week as it was earlier.
High oil prices will hurt global economic recovery, India warns
Milind is not the only one. Millions of Indian households are facing similar challenges ahead of Diwali, which marks one of India’s busiest shopping seasons for consumer goods.
A lot of families have decided against buying items like television sets and jewellery this festive season, according to Reuters which spoke to many people and a consumer survey conducted by Axis My India, a consultancy based in Mumbai, India’s financial capital. These trends might not be encouraging signs for an economy which is trying hard to bounce back from the setback caused by the pandemic.
Economists have also pointed out the ever-rising prices of petrol and diesel and cooking gas that have severely hit three-quarters of households.
“The sky-rocketing prices of petrol, cooking gas are unbearable when our earnings are still down by nearly 30% from the pre-pandemic period,” Sultan Singh Tomar, a 53-year-old supplier of incense sticks and kitchenware to shops in New Delhi, told the news outlet.
There are millions like Tomar in the country’s informal sector who have used up their savings in times of the pandemic and are now compelled to reduce their domestic expenses.
For many months, India’s consumer-price-based inflation stayed above its central bank’s comfort level of six per cent driven by a rise in food prices.
As per an October report by Axis My India on consumer spending trends, more than 88 per cent of respondents in a survey said they will skip buying consumer goods and jewellery goods this festive season while nearly half said they will settle with low-ticket purchases such as clothes.
The Narendra Modi government has not been able to do much to reduce the fuel prices as global crude oil prices has hit a three-year high of $85 a barrel, adding to the woes of a country that heavily depends on importing oil.
There have been talks about bringing oil under the Goods and Services Tax (GST) to give the consumers relief but nothing has happened on that front so far after the matter was discussed at a GST Council meeting last month.
Experts have emphasised that both India’s central and state governments should cut fuel taxes. Bidisha Ganguly, chief economist at Confederation of Indian Industry, said both India’s central and state governments should slash fuel taxes, the highest among the major economies, as higher fuel costs could build up medium-term inflationary pressures.
“(Otherwise) corporate earnings will be impacted in sectors where producers are unable to pass on the cost increases,” she told Reuters, adding global shortages were already pushing costs up.
