NEW DELHI (Commodity Online) : India’s leading industrial body Assocham said prices of essential commodities in the country like milk, vegetables and spices have gone up by around 72 percent against the 38 percent growth in the per capita income of an average Indian in metros in the last five years.
In a survey, the Associated Chambers of Commerce and Industry of India said between 2005-06 to 2010-11, the prices of eight essential commodities have gone up by nearly 72 percent and on the contrary the per capita income of an average Indian in metros has gone up by 38 percent.
Prices of condiments and spices, eggs, fish and meat, milk and pulses witnessed a sharp increase -- 158.07 percent, 78.88 percent, 74.12 percent and 73.69 percent respectively during the period under review.
Other essentials like coffee, tea, wheat, fruits and vegetables too saw upward movement -- 70.75 percent, 66.89 percent, 63.25 percent and 59.31 percent respectively.
On the other hand, real per capita income of an average Indian was measured about Rs.26,025 per annum in 2005-06, however, it went up by about Rs.9,892 in 2010-11, amounting to Rs.35,917 per annum.
Rise of prices of many commodities, including spices and dairy products, are also said to be followed by a change in the food habits of the people. Growing demand for pizzas is one big example where large quantities of cheese and butter are used.
The study also mentioned that the price of milk and milk-based products in India is set to surge on the back of a variety of natural and human factors, including a shortage during monsoon months.
"Once milk price goes up, the prices of milk-based products like sweets, butter and cheese will also go up.
"The prices will be further impacted by the upcoming festival season which sees a spike in consumption of milk-based products, especially sweets," Assocham secretary general D.S. Rawat said.
Unfavourable weather conditions also resulted in the short supply of commodities and consequently pushed their prices up.
Some of the spices whose prices shot up in 2010 are cardamom -- both small and large, turmeric, cumin, garlic, pepper, cloves, poppy seeds, cinnamon and mint products.
The study said an abnormally high percentage of fruits and vegetables goes wasted because of lack of cold-storage facilities. According to Assocham estimates, 60 percent of produce goes to waste and that is a conservative number.
The report also pointed out that the sharp increase in prices of wheat and rice will have an inflationary impact on essential commodities as open market prices of both commodities were ruling slightly higher than the above the poverty line prices.
"Inflation has reduced the purchasing power. The rising prices of essential commodities have made many families remain on tenterhooks. For some families, the price rise seems to have taken the charm away from splurging during the festival season," Rawat said.
