Manisha Jha

NEW DELHI: The first thing one senses upon entering the good old Khari Baoli wholesale grain and dry fruits market off crowded Chandni Chowk in the Capital is an overpowering pungent smell of chillies and spices. What hits you next is the maddening sight of endless crowds of shoppers come here from all over Delhi and outside in search of the cheapest deals and bargains.

But now with food prices wreaking havoc on households, it is not just the retail consumers visiting this ancient market who are feeling the pinch but also the wholesalers who are finding themselves caught amid dwindling profits.

Known for its uniquely named shops -- some of which date back a century and more and are identified by their originally allotted shop numbers rather than their names -- Khari Baoli attracts a large number of customers from States like Madhya Pradesh, Rajasthan and Jammu and Kashmir among others and is trying hard to stay afloat in these increasingly expensive times.

According to many traders in the market, it is the spiralling rise in prices of rice since last year that has singularly affected their business the most. And the situation, if one is to believe the traders, is only going to get worse.

Anil Gupta, owner of Chiranji Lal Ram Lal Shop -- better known as “21 Number Ki Dookan” -- says: “The increase in rice prices is unprecedented and has broken all records. The same parmal rice that cost between Rs.800-900 per 100 kg not long ago now costs around Rs.1,800. On an average, the wholesale rate of rice has risen by Rs.3 to 4 per kg and the retail rate by Rs.5 to 6 per kg.”

“When our old customers come, they fight with us asking why the prices are going on increasing and we have to face their wrath and bend over backwards to try and give them a reasonable deal. If we don’t, then we stand to lose our hard-earned goodwill,” he adds.

According to Joginder Singh, owner of Prabha Singh Jaswant Singh, “mota chawal” which cost Rs.13.50 per kg now costs Rs.16.50 and the flour from Delhi Flour Mills which cost Rs.623 per 50 kg in March-end now costs Rs.670.

“After almost a decade we are witnessing such a sharp rise in rice prices in this market. The prices of items like ghee, mustard oil and soya oil, however, have stabilised since last month,” says Singh.

The effect of price rise is also highly pronounced on Khari Baoli’s famous spice market.

Suresh Bhargava, who owns an old spice shop here, says: “The prices of amchur and coriander powder have risen by over 100 per cent compared with the prices of cumin seeds and turmeric powder which have risen by 10 per cent.”

With customers left with no choice but to compromise on quantities bought by them, it is the traders who are left to bear the brunt in the form of reduced profits.

“Our profit margins are dependent on the prices. When prices are low we are able to sell more, leading to higher profits. Unfortunately owing to the ever increasing prices the quantities sold by us have diminished and our profits nearly halved,” rues Mr. Gupta.

While several traders blame online trading in food items, illegal hoarding by millers, faulty export policy and bad produce as causes for the unbridled increase in prices, other say unfair trade practices adopted by wholesalers in Naya Bazar are adding to their woes.

Says Singh: “Most traders in this market source their supplies on a wholesale basis from Naya Bazar and what hits us is the fact that while we are charged for rice and dal and other items on net weight basis, we are only given supplies on gross weight basis. So we lose a huge quantity overall on our wholesale purchases from them. In addition, we are made to pay commission charges at the rate of 2.0625 per cent to them which increases our purchase cost further.”

In the face of back-breaking inflation and turbulence in market rates of food items, the traders of Khari Baoli have nothing but their rich and proud heritage along with their longstanding businesses to fall back upon.

Sandeep Jain, ninth generation owner of “Chawal Wale 13” shop established way back in 1783, says: “Compared with modern malls that have profit margins of 30 per cent to 40 per cent on grocery items, we are only able to manage a margin of about 8 per cent. Despite some grocery items being cheaper there, many older generation people who have lived in Delhi in the past or have had a chance to savour the city’s rich food culture come to our shops in search of that elusive taste that one can never find in any mall anywhere.”