PUNE People from all income groups bear the brunt of the crisis as inflation rises to its highest level in eight years amid rising food and fuel prices due to various factors such as the pandemic of Covid-19 and the ongoing Russian-Ukrainian conflict.
One of them is Ramchandra Pardeshi, 70, who has been selling vada-pav in the hills of Fakhri for nearly 25 years now. “My financial situation is currently the worst it has been in the past 25 years,” said Pardeshi, who runs a vada-pav stall during the day and has now been forced to also start driving a rickshaw. automatic grow to supplement income.
Retail inflation in India hit 7.79 percent on an annual basis last month, according to data from the Ministry of Statistics and Program Implementation. “I switched to selling vegetables during the pandemic. My livelihood has been completely impacted. With rising inflation, we have to reduce the family budget and start doing different jobs,” lamented Pardeshi, who has a family of six to support.
Currently, he also drives an auto rickshaw and runs the vada-pav stand. “Before, we bought a can of oil from ₹1,400. Since last month, the cost has doubled to approximately ₹3,000. Since I cannot increase the cost of my product accordingly, my family budget has shrunk again,” Pardeshi lamented. While manning the stall with his son, Santosh, he had to cut back on the amount of food in his house. “Managing my family is becoming difficult day by day. It becomes impossible to make ends meet,” he said.
Not only for people like Pardeshi, even manufacturers and those running bigger companies are facing tough times. India’s automotive industry has remained the world’s fifth largest in recent years. However, raw material manufacturers have had to cut costs further due to soaring prices.
Jaideep Baphna from Kalyaninagar, Pune, 50, owner of Mutha Foundries in Satara, said: “My profits have been cut in half. Supply chain issues added to my misery. Scrap dealers have also raised prices. Mutha Foundries has its main factory in Satara and manufactures metal castings and other interior parts for automobile production in India.
“We are not able to achieve the objectives set by the company. Borrowing has increased. To balance this, employee wages have also been cut,” Baphna said. “Inflation has also changed the work environment. It’s hard to balance your personal budget with company profits,” he added.
Meanwhile, large manufacturers and technology companies are also facing the problem of attrition. With low employee satisfaction and the absence of appropriate salary increases, employees change jobs frequently.
Souvik Bandopadhyay, Banker at Tata AIG, Pune, said: “There have been no pay rises, appraisals or high corporate bonuses for years. I had to abandon my start-up and switch to banking to have some stability during this period.
As India is experiencing the highest headline inflation this month since hitting 8.33% in May 2014, edible oil and fuel prices have risen across the country. “I am completely dependent on private vehicles for my travels. Rising gas prices made my daily commute much more expensive. There are also no subsidies,” Bandopadhyay said. There is virtually no room for personal savings and investment, he added.
Moreover, savings and investment rates have also declined by two percent on a personal basis, says Bandopadhyay.