On a breezy morning in Chennai, one may end up fighting a losing battle to ignore the urge to sip a hot cup of filter coffee. The aroma of the sizzling brew wafting up from the roadside eateries is a clear winner. A legendary, party-loving Mysore king may rightly stake claim that masala dosa is his brainchild, but Chennai would resolutely assert its stamp on its own version of the crispy rice crepes and the unadulterated coconut chutney. This is the land of mouth-watering south Indian delicacies; streets dotted with restaurants. For every Adyar Anand Bhavan, there is a Saravana Bhavan, Sangeetha, Murugan Idli, and the likes. The authentic filter coffee, golden-brown vadas, puffy idlis, pongal, and of course, a variety of dosas. It’s a sine qua non of Tamil breakfast; even the non-vegetarian majority of Tamil Nadu swears by it.
The fact is that a healthy breakfast in Chennai comes at a cost. A family breakfast at a restaurant is nothing short of a luxury for many. It drills a deep hole in your pocket. Are these eateries making a huge profit? For the uninitiated, the days of pandemic-driven restrictions, dwindling footfalls and the unsustainable rent are over. After shutting down many a loss-making outlet, popular restaurant chains have surely swung back to business. Post lockdown, they have only retained the outlets that are financially sustainable. The common refrain is that every ingredient is priced high, making the end product dearer. Some of their options have to do with pure geometry: shrinking dosa’s radius and amplifying the vacuum subset inside the vada.
Tamil Nadu that prides itself in holding on to a moderate food inflation has seen retail prices shoot up, in the recent past. The state government’s proactive initiatives for the rural poor as well as an extensive PDS (some would want to call it ‘Revadi culture’) had indeed reined in the food inflation. But the high oil/gas prices and logistics costs are driving up the overall inflation. Fake social media messages, meanwhile, blindfold men to believe that state governments -- and not New Delhi – are snatching away your penny in the name of taxing oil and gas, to ‘serve’ you better.
What is most perplexing is that the rural inflation is more than the urban inflation. If we go by the central government’s latest numbers for January 2023, the rural inflation in TN stands at 7.18% while urban inflation is a tad below, at 6.48%. In comparison, TN’s numbers are lower than that of some big states such as UP, MP and Telangana. But West Bengal, Maharashtra, Gujarat and Karnataka have reported a better performance. TN’s inflation numbers remain at an elevated range when compared to the national average of 6.85% and 6% respectively.
That calls for a serious introspection.
Are interest rate hikes effective in dealing with inflation? Many are sceptical about its efficacy. The government numbers show that wheat and other cereal prices have pushed up the retail inflation to a three-month high. Going forward, truant weather has promised to spoil rabi crops and impact food inflation further. On the flip side, prices of vegetables are on a steady fall, recording a negative growth of 11.7% and leaving farmers in the lurch. Only monetary policy and the interest rate management by RBI may not be enough to keep inflationary pressures under check.
At a time when retail inflation has emerged the biggest demon that our neighbouring countries are wrestling with (In Sri Lanka, retail inflation is above 60%; In Pakistan, it is above 20%), ignore it in India at your own peril. New Delhi should cajole state governments to join the fight, and stop deriding their efforts as a political ploy. It may entail a complete departure from the status quo of snatching away states’ authority and leaving them cash-strapped in a fractured federal system.