When the April 2021 retail inflation came down to a modest 4.29%, an attempt might have been made to communicate a false sense of relief. The real picture, though, is very different as is evident from the across-the-board rise in prices of goods – especially grocery items and FMCG goods.
An analysis by The New Indian Express shows that it is not just petrol and diesel prices that are scalding you. Prices of edible oil, tea, and pulses have seen a double-digit growth in the last one year with edible oil prices rising by 50-55%.
Palm oil, a key ingredient for home and personal care items including soaps, for instance, has grown dearer by up to 50%.
Even prices of metals like steel and copper have increased by 80% over the last one year, while the prices of zinc, aluminium and nickel have surged over 50% in the same period. All of this indirectly impacts the common man grappling with the blows that a once-in-a-century pandemic has delivered.
Already costly petrol and diesel prices, meanwhile, have risen by 30-40%. Our analysis shows that the government collected an additional Rs 1.8 lakh crore in 2020-21 through the hike in excise duty on petrol and diesel.
That's not the end of it, as FMCG companies are gearing up for another round of price hikes for daily-use products like detergents, soaps, creams, edible oil and tea to offset the inflationary pressure.
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Even economists are now beginning to worry about the impact this could all have on an already sagging economy.
"On top of rising input prices, supply disruptions brought on by the intensification of the second Covid-19 wave in rural India are adding to the stock of inflationary pressures,” Dharmakirti Joshi wrote in a Crisil report.
Any relief in the offing, Madame FM?
Data compiled by Sesa Sen.