Roti, kapda, makaan: As prices shoot up, Indians may have a tough run to cover the basics

For the average Indian household, this is a time of grave concern. With rising inflation and interest hikes, the oft-measured trinity of roti, kapda and makaan have all seen a spike in prices. Wheat flour or the homely atta, vests and briefs, and house loans have all become expensive. 

This is unwelcoming news for the Indian household, as they might have a tough run to cover the basics. 

To begin with, the monthly average retail price of wheat flour was Rs 32.38 per kg in April, which is the highest since January 2010. The increase in price comes on the back of decrease in production and stock, and increasing demand outside the country. The ongoing Russia-Ukraine war has limited supply from Ukraine, often known as the breadbasket of the world.

High domestic fuel rates have also increased the prices of wheat flour. Additionally, a sudden increase in March temperatures have dampened the government’s expectation of record wheat production. It is expected to fall short of the production target. 

Food Secretary Sudhanshu Pandey said the agriculture ministry has revised the wheat production estimate downwards by 5.7 per cent to 105 million tonnes in the 2021-22 crop year ending June from 111.3 million tonnes earlier. 

Meanwhile, yarn prices also went up by Rs 40 per kilogram, mostly due to increasing cotton rates. The Apparel Export Promotion Council (AEPC) asked the government to take immediate action against the increase in price. The South Indian Hosiery Manufacturers Association also announced plans to increase the price of vests and briefs by 15 per cent. It currently costs Rs 50-100, and is expected to rise to Rs 70-100. Garment unit owners have announced a strike from May 16 to 21. 

The price of cotton yarn, which was around Rs 376 per kilogram in March, rose to Rs 406 in April and further to Rs 446 a kg as of now, the AEPC said in a statement. The prices of yarn have more than doubled from Rs 200 per kg witnessed 18 months ago, it said.

Which brings us to the third part of the trinity – houses. Following RBI’s rate hikes, banks are expected to increase their lending rates. In fact, some of the banks already increased their rates before the repo rate hike. RBI, in an off-cycle MPC meeting, decided to increase the repo rate by 40 bps to 4.40 per cent. Not only this, SBI Ecowrap predicted further hikes in June and August too.

High repo rates translate to more expensive loans for big-ticket items such as houses. Housing loans are then expected to see a hike too. 

Also read: Rupee hits all-time low; here’s how it may impact your life