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LATEST NEWS UPDATES | Inflation Spiral is Hitting the Working Poor the Hardest -Sanjay Roy

Inflation Spiral is Hitting the Working Poor the Hardest -Sanjay Roy

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published Published on May 20, 2022   modified Modified on May 22, 2022

-IPA News Service/Newsclick.in

Time is ripe to do away with every central cess on petroleum products and reject the government’s narrative that the poor are hurt less by higher prices than the rich.

The country is in the grip of an inflationary spiral resulting in a galloping price rise of all essential goods used by people. This crushing price burden is making life exceedingly difficult for the rural and urban poor.

The retail inflation rate stood at 7.8% for May, the highest in the past eight years; food price inflation surged to 8.38%, the highest in the past seventeen months; and the wholesale price index inflation in April rose to 15.08%, the highest level in the current 2011-12 series. 

What do these dry statistics mean for ordinary people, particularly the poor? It translates into increased prices of atta, vegetables, edible oils and cooking gas. It means less to eat for the poor and lower-middle-class families, cutting out nutritious food for children and the inability to buy any goods necessary for a minimum standard of living. The price of atta, a staple of north India, has increased by 13% over one year (May 2021-May 2022), and milk costs over Rs. 50 per litre, cooking oils are priced around Rs 200 per litre, and the seasonal prices of vegetables have shot up.

Inflation means loss of livelihood for lakhs of people – street vendors and those surviving by running small businesses. It also hits the small and micro-enterprises.

The single biggest factor in the inflationary spiral is the rise of fuel prices. The central government’s policy of steady increase in central taxes on petrol, diesel and liquefied gas has led to an unprecedented surge in the price of petrol, diesel and cooking gas. This process began much before, and the Ukraine war has only aggravated the situation. Since fuel is a universal intermediate, the rise in petrol and diesel prices has had a cascading effect on the prices of all commodities. 

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Newsclick.in, 20 May, 2022, https://www.newsclick.in/inflation-spiral-hitting-working-poor-hardest?fbclid=IwAR1PJcXYmJC9V5La0Dke5eNCBrrQ6hIi3MQfsTRzdKVgOiFDrMhhwKPL_Ck


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