THE INFLATION STORY

"Do you feel the inflation?"

Inflation is a price hike of goods and services in a region (in general, a nation) over a period of time. Unlike US, UK, Japan, France, Canada, Singapore and China (using Consumer Price Index - CPI), India uses Wholesale Price Index (WPI) to calculate inflation. To be clear, India uses the measure of the weekly change in the price of 435 commodities in wholesale market. Few economists criticise on the accuracy of this method as wholesale price is different from consumer price and more than 100 of the 435 goods are not consumer goods.

Recent days, Indian inflation is in news continuously as it reached a 13 year high (Today, it's 11.63%). Is inflation only in news? Don't it affect a simple citizen's (like me) day-to-day? My college mate cum colleague (who is in the process of mastering economics), yesterday, asked the question in the first para to me. I have a strong "Yes" as the answer to him and realised there is a list of evidences proving that I am also a victim of this recent Indian inflation.

• A marginal increase in home loan interest rates by major banks, public and private.
• The phrase "Do you have change?" expects 50 or 100 rupee notes and not 5 or 10.
• I haven't seen one or two or five rupee note currencies in the recent past.
• There is a starvation of 1 rupee coin - instead having abundant of 2 rupee coins.
• 50 Paise coin is unofficially abolished in many metropolitan cities including Bangalore.
• A 100 Rupee note filling a bag full with groceries/ vegetables become a mere history.
• At least, a sum of Rs.500 is mandatory for a couple to watch a movie in a multiplex.
• The size of the cup to serve coffee/ tea shrunk considerably in many bakeries.
• The water content ratio in the fresh fruit juices is increased in almost all shops.
• A half litre milk, though cold, cannot fetch you a polythene cover to carry.
• Increase on barber shop service rates encourages self-shaving massively.
• Price of Pirated editions of CDs/ DVDs/ books seems to be increased at least by 30%.
• Bearers of moderate hotels are not accepting any tip amount less than 10 Rupees.
• Beggars are not willing to get anything less than 1 Rupee (same with temple priests).
• Another interesting hearsay - pimps increased their commission amounts.
  

All the above except the last one affects me, directly or indirectly, to some extent. And I suppose, everybody - more or less, is in the same line, facing the inflation-borne issues, confining to their respective levels. My friend says "Every human individual will see 3 notably high inflations, 2 recessions and a depression in his life time".

If that's true, Chidambaram Ayya! Bayama Irukku. Eathavathu Seinga!