“Accept certain inalienable truths.
Prices will rise
politicians will philander
And you, too, will grow old.”
The aforementioned saying has only grown in popularity over time, and it is not farther from the truth. As the bells toll for another new year and we add another year to our lives, prices across the board will hit another high.
Blame it on inflation or the impact of COVID-19, but the fact is that the average Indians' spending power will take another beating, come 2022. Anything from rice to vegetables to bikes and cars are set to become dearer.
While many FMCG makers are struggling hard to contain the rise in raw material costs and not pass it on to consumers as the market is still not positive enough, some experts feel it will be a losing battle.
Meanwhile, following the telecom operators, auto majors have decided to bell the cat, already announcing price hikes from January. Market leader Maruti Suzuki has taken the lead here as well, announcing a price hike for models in its Nexa and Arena line-up – the new rates are likely to be revealed later this week. This will be the fourth price hike by the Gurugram-based company, which has taken a knock equally due to rise in component costs as well as an acute shortage of semi-conductors.
Others set to increase prices in the new year range from Tata Motors (2.5 per cent rise in cost of all commercial models), Volkswagen (3 to 5 per cent bump up), besides Skoda, Citroen and Audi all increasing prices by 3 per cent. Mercedes-Benz has announced a hike of 2 per cent. The price of all Toyota vehicles will also become dearer, but the exact figure is as yet unknown.
Hero MotoCorp, the world's biggest two-wheeler maker, has also decided to increase the price of its bikes from January 4. Joining in are premium bike makers Kawasaki and Ducati, with Hero's rivals likely to join in in the coming days.
If you thought it was just automobiles, think again – everything from rice to atta to pulses to FMCG products have either gone up in cost, or are under intense price pressure. The reason is a mix of post-COVID economy flux, where a mix of elements, ranging from uneven growth due to excess fund in the system, supply chain issues and spike in the cost of many commodities having a domino effect on the retail markets.
In fact, inflation, an otherwise boring government statistic, should be of concern to all ordinary citizens – according to the commerce ministry, overall wholesale inflation went up above 14 per cent last month, the highest since 1991. Specifically, the food prices rose nearly 5 per cent, petrol and electricity costs by almost 40 per cent, while manufactured products went up nearly 12 per cent.
With retail inflation is still at around 5 per cent (mainly due to rise in price of food items like rice), problem with the high figures on the wholesale inflation side is that it could soon get passed on to the retail side, the point where we consumers get affected.
