Tomato to fuel: Inflation batters India's middle class

NEW DELHI: From daily essentials like tomatoes, milk as well as edible oils to transport fuels, rising prices have hampered the financial health of ordinary middle class families in India.

The trend has not only hurt the economically weaker section of the society but has lately been cited to impact the savings rate of the well-off. The biggest impact of inflation is that it affects the purchasing power of the fixed income groups as they can buy less compared to what they were buying earlier.

However, even as consumer price-based inflationary pressure has eased lately on a macro level, it is still high enough to hamper the financial health of any middle class Indian family.

Notably, the CPI-indexed inflation has come down to 6 per cent which is in the comfort zone of the Reserve Bank of India.

But some items of CPI as well as wholesale price inflation (WPI) have shown a drastic increase such as transport fuel prices.

Significantly, any rise in fuel costs bumps-up prices of nearly all the essential items because of a second-round effect. A rise in fuel rates typically impacts overall freight and transportation costs.

Rahul Kumar, 28, who commutes to work in Noida on his two-wheeler, says that the rise in petrol prices exhausts his monthly income rather help him accumulate his savings.

"The rise in petrol prices to above Rs 100 per litre, of tomatoes at Rs 80 per kg, besides ever rising rents could not have come at a worse time since we are already having pay cuts," he said.

"The high spend on petrol due to exorbitant prices itself depletes my income. There has been no savings or investments for at least the last two years."

Similarly, Chabilal Das, a middle-aged daily essential supplier in Noida, also expressed concerns about the rise in prices.

"My income has gone down drastically post pandemic as many few people working in formal sectors have returned to the city as they have work from home options. They are my target customers. How will I pay my EMIs now, that has now become my biggest headache," Das said.

Anil Kumar, 40, a Delhi-based cab driver, said rising fuel prices have hurt his cost-to-income margins. (IANS)

Also Read: Tomato prices skyrocket in Chennai

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