While the 6th Pay Commission report came as very good news to more than 5.5 million Government Employees across India, there is a bad news for the common man. The inflation rate touched 12.44 per cent for the week ended August 02 2008, which is a 13 years high rate. The inflation rate was 12.01 per cent for the week ended July 26 2008. If we see the figures from last one year, the rate has tripled. The inflation rate was around 4.6 per cent around the same time last year.
All efforts by the Indian Government have failed and inflation continues to rise. Even Prime Minster Mr. Manmohan Singh identified this problem during his speech on Independence Day from Red Fort. He washed his hands by saying that the rise of Inflation is due some external factors. With due respect Sir, what does external factors mean? We understand that the inflation has risen for every country on account of Oil prices, but not 3-4 times (in an year) as we have seen in India. We were aware of the rise of Oil prices from last 1 year, why steps were not taken to stop it! All the short term measures like Reserve Bank increasing the lending rates, financial policies, checks etc provided futile and the common man is facing the problem with increased price in essential commodities.
It’s said that the rise in inflation is not only due to Oil prices alone, but largely due to bad policies and also due to relaxing of the farmer loans in tune of RS. 400 billion. Further 21-35 per cent pay rise in the salaries of the Government Employees (w.e.f 1/1/2006, which means we have to pay 2.5 years arrears as well) will further put burden on the economy (again, Govt. says it will not). Though the finance ministry says the inflation rates will fall after touching the 13 per cent mark, many think we might well cross 15 per cent.
Now hear this: The Inflation rate is calculated based on only certain products and is a WHOLESALE PRICE INDEX (WPI), which is not used by many countries across the world. Developed countries across the world used CONSUMER PRICE INDEX (CPI), which is what a common man might be interested in. So if we take into account CPI, the rates might be much higher. Read more about WPI and CPI.
Further, against the GDP growth of above 9 per cent last year (2007), this year, as per reports India has witnessed only 7.7 per cent growth, which is even lower than the anticipated rate of 8 per cent by the Central Government. This is the weakest performance by the UPA Government in last 4 years and surely people will ask this question in the next general election scheduled during May 2009.
What does rise in inflation means in common man’s language? The cost of living will increase with the rise of inflation. While our parents and grandparents were too particular about buying each commodity and saving each penny, we as techies and earning better income prefer to go to big malls and pick up things we want without checking the change in prices. We love to use our credit cards, which is mapped to our Bank accounts and the rise is not felt by many of us. It’s like a slow poison killing our hard earned income and we will feel the crunch sooner or later.
Zor se Bol (speak aloud) so that Government and other governing bodies help reduce this INDEX.