Pricey kitchen staples burn hole in pockets
Tomato to tur dal, essential food items have been registering a sharp price hike in TN for over a year, thanks to rise in fuel prices, leaving residents worried about putting food on the table. Govt, meanwhile, doesn’t want to let go its revenue by slashing the taxes
People of Tamil Nadu have been feeling the heat of a massive increase in the prices of essential food items for over a year and the recently released data on inflation by the central government substantiates the sufferings undergone by the majority of the population.
According to the data, oil and fats have registered a massive rise of 29.67 percentage inflation in November, this year, when compared to the previous year. The continuous rise of prices of dal and edible oils are eating into the monthly household budget for over a year.
For instance, the retail prices of tur dal, urad dal, moong dal and channa dal have remained over Rs 100 per kilogram for more than a year while the price of edible oils, particularly, sunflower oil and palm oil has shot up by 60 to 70 per cent in the last year.
Though economists blame the rise in fuel prices as the major reason for the price rise, they also say that various other reasons also influence the rise in prices of essential commodities. “Containing inflation is one of the important tasks of the Reserve Bank of India (RBI). But the situation that arose due to the pandemic has resulted in the price hike. The fuel price hike is the most important reason for the rise in prices but as far as Tamil Nadu is concerned, supply constraint has also resulted in a rise in prices of essential commodities, which was evident from the rise in food prices during the recent monsoon season,” Professor KR Shanmugam, Dean, Madras School of Economics, told DT Next.
He also said that though the fuel price hike is the main reason for the price hike, no government is ready to reduce the taxes as it will cause a huge burden on their finances especially during the pandemic times as they had to spend on unplanned expenditures in the health sector.
Similarly, renowned economist Anand Srinivasan also blames the rise in fuel price as the major reason for the massive rise in prices of essential commodities. “When compared to the previous year, fuel and LPG prices have increased by 40 per cent. For the majority of Indians, 70 per cent of their income goes to rent, conveyance, electricity and food and the majority is feeling the heat due to the price hike,” said Anand Srinivasan.
The economist also said that the increase in prices has resulted in a decrease in consumption which was evident from the statements of top food processing companies like Britannia and Parle G. The central government should reduce the indirect taxes to increase the consumption but instead is increasing the GST to jack up their revenue.
Govt measures: Too little, too late
In order to monitor the availability of food commodities at a fair price in the open market, a Price Monitoring Cell is functioning in the Commissionerate of Civil Supplies under the direct control of the Commissioner.
“This price monitoring cell monitors the prevailing retail and wholesale prices of selected food commodities like rice, wheat, pulses, sugar, edible oils and vegetables in the open market on a daily basis,” said Tamil Nadu Minister for Food and Civil Supplies R Chakkarapani, who heads the price monitoring committee.
The minister also said that the state government has constituted a Rs 100 crore fund for price stabilisation. The price monitoring cell continuously monitors the prices of essential commodities and whenever the prices of essential commodities go high, it intimates the state government.
Cost of living in city a concern for traders, residents
R Punnaiappan, general secretary, Koyambedu Wholesale Food Grains Market Association attributes the rise in the prices of dal items to the demand-supply gap caused by the import restrictions and pulses crops hit by monsoon vagaries.
“The Union government has restricted the import of pulses to ensure farmers get a good price for their crops. However, the delayed onset of the monsoon last two years impacted the pulses crop cultivation across the country, especially in Maharashtra and Karnataka which supplies good quality toor dal,” he said, adding that tur dal price will continue to hover over Rs 100 per kg even next year as well.
Urad dal is mainly sourced from Maharashtra, Andhra Pradesh and Tamil Nadu (Thanjavur, Chidambaram and Kovilpatti). He said the heavy rain in the last week of November damaged urad crops in Andhra Pradesh. “The price of urad dal goes up by Rs 15 to Rs 20 after processing. One kilogram of branded urad dal costs Rs 140 while unbranded dal costs Rs 112 kg,” he said.
Moong dal is sourced from within the state from Minjur in Tiruvallur and Thoothukudi. “Nowadays people are preferring polished imported moong dal which is tasteless compared to dal cultivated here,” he noted.
As far as the edible oils are concerned, he said sunflower and palm oils are imported to meet the demand. “There will be a difference of Rs 20 a litre between sunflower oil and palm oil but it was sold at equal price,” he noted.
A litre of sunflower oil which was sold for Rs 90 is now being sold at Rs 137. The palm oil which was sold at Rs 70 a litre is now sold at Rs 115. “The price of sunflower oil shot up owing to a short supply of palm oil. Palm oil, which was mainly imported from Malaysia and Indonesia, was being used for biodiesel in those countries. It led to a shortage of palm oil which in turn led to the increased demand for sunflower oil,” Punnaiappan said.
Small traders blamed the difference in fuel prices as the reason for prices being high in Tamil Nadu. “Edible oils, sugar and jaggery have seen a massive hike in prices in recent days. The main reason the companies claim for the price hike is the rise in transportation cost which is due to fuel hike. When the trucks which carry the goods return empty they charge the diesel rate from the traders which are reflected in the prices of essential commodities. The small traders also have the problem of competing with supermarkets and we have to keep our prices competitive to retain consumers and it is difficult to run the shops daily,” said Tirupathi, running a small grocery shop in Kolathur.
Tamil Nadu Vivasaigal Sangam general secretary P Shanmugam blamed the steep rise in the petrol and diesel prices for the continuous high prices of dal and edible oils. “We get dals from other states. With the increase in the cost of transportation owing to the diesel price hike, the cost of dal and edible oils remain high,” he said.
However, the common man, who is at the receiving end, feels the heat as they say that with the hike in the price of essential commodities, it is difficult for them to manage their daily affairs. Parvathi, a domestic worker in Thiru Vi Ka Nagar, said the rise in prices of essentials has also reflected in house rent as her landlord has increased the rent post-second phase of COVID-19 lockdown. She urged the state and central governments to take necessary steps to reduce the prices of commodities.
Union Minister of State for Food and Consumer Affairs Sadhvi Niranjan Jyoti told the Lok Sabha that domestic production of edible oils is unable to meet domestic demand. “The domestic consumption or demand of edible oils is around 25O Lakh Metric Tonnes (LMT) while the domestic production is only 111.6 LMT. The gap between demand and supply of edible oils is around 56 per cent and is met through imports. The increase in the international prices has an impact on domestic prices of edible oils in the country,” the minister replied to a question.
Pricey kitchen staples burn hole in pockets
The production of domestic oilseeds has been stagnant since 2010-11. “However, domestic demand for edible oils has been increasing at a pace faster than that of production due to growth in population and improvement in the living standards. Hence domestic production is insufficient to meet the demand. An increase in international prices of edible oils has led to an increase in the cost of imports and consequently their prices,” the minister said.
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