With the prices of almost all essential commodities going up, the government and private players revising the tariffs and charges of services periodically and the housing and car loans going up constantly due to repeated increase in the deposit rates by the Reserve Bank, ordinary people have been left wondering when will this cycle of inflation, lack of growth and resultant unemployment finally stop.
For people living in and around Delhi, the recent days have been of financial agony. The worst affected by the hikes are the poor and the middle class who have limited incomes.
“I have stopped giving milk to my children as I no longer afford it,” said Anjana, a domestic help who works in East Delhi and supports three children. “We now take half-a-litre of double toned milk a day and just have tea made of it,” she elaborates, noting that toned milk that cost Rs. 21 per litre two years ago now costs Rs. 29.
This holds true for millions of workers in the unorganised sector. “Now both my husband and I iron clothes to ensure a bright future for our two children,” said Sunita, who works in Indirapuram in Ghaziabad. “The problem is that the price of coal has gone up sharply and when we increase our charges, people cut down on the number of clothes they want ironed.”
Such families are struggling in the face of rise in prices of edible commodities which take a chunk of their earnings. “Going to the doctors is also becoming very expensive and the prices of medicines have also increased,” she said.
For the middle class, worries have increased manifold. To curb inflation, Reserve Bank has raised the interest rates 12 times in 18 months. But still the inflation is near the double digit mark and the growth is slowing raising fears of businesses closing down and resultant loss of jobs. Also this has led to a near 25 per cent increase in the equated monthly instalments (EMI) on housing and car loans.
“I had purchased a flat in Gurgaon last year. At that point, the housing loan EMI was Rs. 36,000. Now it has already reached Rs. 45,000… I am not sure where is it headed,'' said software professional Ramesh Garg.
What is perplexing residents is that while on one hand the Government talks of controlling inflation, on the other it has been raising fuel prices which will only lead to its increase.
“The middle class is paying the price of trusting an eminent economist who is an incompetent manager. Forget the scams, how does he explain petrol at Rs. 43 per litre when crude was ruling at Rs.140 per barrel just before elections? Rising prices is the work of a hat juggler rather than an economist,” commented Rajiv Kakria, chairman of E-Block Resident's Welfare Society, Greater Kailash-I. He has a point since petrol prices have risen nearly 65 per cent to Rs. 66.84 per litre since June 2009, when they were at Rs. 40.62 per litre.
With the price of domestic liquid petroleum gas (LPG) increasing by Rs. 50 per cylinder in June this year and Indraprastha Gas Limited, the sole distributor of natural gas in Delhi NCR, raising the price of piped natural gas (PNG) for its 245,000 domestic customers by 42 per cent in the last 18 months, household budgets have also been upset.
R.K. Puram-based homemaker Deepa Kumar wonders: “Is this the price to pay for the irreversible process of globalisation? Why doesn't the government think of alternative measures like unearthing black money stashed away in foreign banks, reigning in middlemen and banning trading in future markets? It has become really difficult for us housewives to manage the monthly budget as most of the vegetables, pulses and other essential household items have doubled, or even trebled within the last five years.”
The incidence of price rise has become so frequent that Public Sector Employee PSU employee Rima Raina, a resident of Mayur Vihar II, says: “Every morning one braces for a new announcement of price rise. Milk prices for instance have been on the surge for over two years now. Can milk be substituted? The common man has no other option but to pay. All essential commodities have become expensive, forget the poor, we the middle class feel the pinch. Water, power, petrol, LPG, everything is expensive and there is no relief from rising interest rates on bank loans. We are really worried about our future.”
“While the dearness allowance of government servants was raised recently and those of some private sector employees also rise with the prices, that is not the case with contractual or casual labour,” said Baijal Nath, who runs a placement agency in South Delhi. “The Government should realise that incomes of most people are limited.”
In the case of Delhi, the residents have also been hit hard by the recent power tariff hike which came into effect from September 1. The tariff has been raised 21.33 per cent and with nearly Rs. 10,000 crore of under-recovery yet to be accounted for, they can brace for further hikes ahead.
Apart from impacting household budgets directly, the tariff hike will also have an indirect bearing on family expenditure. There are several major reasons for this. A major impact of the power tariff hike will be felt by the Delhi Jal Board as it consumes a lot of power in operating its water and sewage treatment plants as also the pumping stations.
The Delhi Metro Rail Corporation runs entirely on electricity and power is its main fuel. As such the hike in power rates is bound to be transferred to the people in the form of higher fares, something people would like to do without.
