Retail reality busts PM’s inflation claim

In his first interview of 2019, PM Narendra Modi told ANI on Jan 1, “Inflation, we have brought it to 2-3% where once it touched 18%.” National Herald went out to the streets for a reality check

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Tathagata Bhattacharya

In his first interview of 2019, Prime Minister Narendra Modi told ANI on January 1, “Inflation, we have brought it to 2-3% where once it touched 18%.” Tathagata Bhattacharya went out to the streets for a reality check. He found out that from foodgrain to clothes, from sugar to curd, from fruits to puja provisions, the average price rise over the last two years hovers between 20 and 100%. That’s how much more the average Indian is paying as compared to two years before


Fruit seller

“The most significant rise has been in the prices of bananas and apples. I would sell a dozen bananas two years back for ₹40. Now I am selling them for ₹60. There is another inferior variety which is selling for ₹50 but I don’t keep them. Desi apples which would retail for ₹80 a kg two years back are now selling for ₹120 a kg. The price of Washington apples (bright red with stickers on each fruit) has increased by ₹60 a kg. Watermelon prices are also up by ₹25 a kg as compared to two years back. Oranges have not been that much affected as they are seasonal. Also fruits like musk melon, kiwi, etc have not been affected as they have niche buyers. Also, our transportation cost has increased. Me and my uncle, we co-own this store. We occasionally joke between us that let us save some money and buy a chota hati (Tata’s small goods carrier vehicle). That way, we would save the money we are right now paying others for transportation. And we can hire it out for the rest of the day to make some additional money.”

Retail reality busts PM’s inflation claim


Grocery and provisions store owner

“Prices of almost everything have gone up significantly over the last two years with possibly the exception of Arhar and Toor dal. Arhar prices had gone through the roof in 2015 when it crossed ₹150 a kg. The biggest increase, which in my opinion is hitting people hard has been in the price of atta (wheat flour). Two years back, it was retailing for between ₹20 and 22 a kg. Now it has gone up to ₹30. The price of sugar has also gone up significantly from ₹30 to ₹40 a kg. But you can’t get by without sugar. A crate of 30 eggs now sells for ₹160 where as two years back, it would come for ₹130. Prices of home-use batteries (AA, AAA) have also gone up by almost 20%. Paneer prices, also, have gone up by almost 20%. Curd prices have risen by exactly 22% in the last two years. Prices of cooking oils, specially mustard, have risen between ₹20 and ₹30 a litre over the last two years. Bread prices have gone up from ₹30 to ₹40. I do not know about the government’s claim of keeping inflation in check. But I can say that end consumers are not benefitting as we are also procuring at a much higher price. Also, transportation charges have gone up significantly. When oil prices were rising, they raised the rates. And the rates have not come down. Also, the earlier GST rates also ate into our margins significantly though now, I am hopeful it will get better with the recent changes.”

Retail reality busts PM’s inflation claim


Glass fitter and steel/iron door maker

“Two years back, a sturdy iron gate of the size of apartment doors would cost you ₹9000. Now, the same comes for ₹12,000. Steel doors are more expensive. They start from ₹18,000 and can even go up to ₹25,000. Both iron and steel has become more expensive, there have been a 20% jump at least. Also these materials are heavy. So higher transportation costs also take the prices up. I have three people on my payroll. Two are metalworkers and one is a fitter who also works on glass and could not give them any hike in 2017 and 2018 as Demonetisation had destroyed my business (Dhanda lagbhag bandh ho gaya tha). People were not buying new flats, neither homeowners had the cash to pay me. It has improved somewhat in 2018 but still today my business is at a 30% low as compared to what it was before November, 2016. Also as prices have increased, people are hesitant to get iron or steel doors installed right away. Taking advantage of the situation, some people have started selling inferior stuff for less than ₹10,000. People do not understand that they are not saving ₹2000 like they would like to think as those doors will need replacement after a few years.”

Retail reality busts PM’s inflation claim


Puja provisions seller

“Prices have gone up for almost everything, specially for cloth items. Camphor price has nearly doubled just over the last one year. We are selling 100 grams of unbranded camphor now for ₹195. Branded ones are more expensive. Incense sticks’ (agarbatti) prices have risen by about 20% over the last two years. So have prices of guggal, mustard seed, etc. Prices of idols and other items like diya (lamps) made of brass have increased by almost 30%. The price of brass items started going up from 2017 after many small factories shut down in the aftermath of Demonetisation. As the number of suppliers came down, our ability to negotiate also took a hit.”

Retail reality busts PM’s inflation claim


Manager at a stationery and books store

“Pens and exercise books have become cheaper after GST came into effect. Also, a lot of new companies have come in, offering products at half the price commanded by the then market leader. They have displaced ITC’s Classmate brand whose sales have fallen by almost 90%. But printer cartridge prices jumped from ₹550 to upwards of ₹800, almost a 50% jump. Printed books have become more expensive but publishing houses usually raise their prices with each new edition anyways. GST has reduced our margins significantly but consumers have benefitted.”

Retail reality busts PM’s inflation claim


Clothes seller

“Prices of readymade shirts and trousers, specially non-cotton, have gone up exponentially. You may say it has doubled over the last two years. The shirt, that cost between ₹150 and ₹200 in 2016, does not come below ₹300 now. Right now, we are selling mostly woollen garments, winter socks, etc. Prices of sweaters have increased by an average ₹100 over just the last one year. Woollen socks are selling at ₹50 more than they were last year. The price of pashmi chappals (kind of fluffy-clothed shoe with rubber soles for indoor use) have risen by ₹150-250 over the last two years, depending on the design and quality. Leave aside these things, even a basic cloth bag now comes for upwards of ₹100. The hundred-Rupees note has no value now. Everything has become so expensive.”

Retail reality busts PM’s inflation claim

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Published: 05 Jan 2019, 11:03 AM