Households prefer to wait and watch prices after budget

NEW DELHI, June 2: With salaries in hand, households are trying to work out the implications of the recently announced budget. Monthly shopp...

NEW DELHI, June 2: With salaries in hand, households are trying to work out the implications of the recently announced budget. Monthly shopping has been put on hold for a couple of days as they try and calculate the likely strain on their pockets. While everyone is expecting basic commodity prices to increase marginally, there is speculation regarding the impact of the budget allocations on the prices of provisions.

M.M. Aggarwal, president, Delhi Vyapar Mahasangh which represents the powerful traders8217; lobby in old Delhi8217;s Khari Baoli and surrounding areas, says: 8220;As petrol prices have gone up, there will be an impact on all edible items. The prices of specific commodities like tea, sugar, dals etc will increase by 15 to 20 per cent. Also, due to the increase in excise duty, all packaged products, including butter, cheese, atta, namkeen and mithai will also go up. A packet of namkeen that costs Rs 40 will now cost Rs 45.8221;

8220;However, there will be no immediate increase in prices. It will take almost a month to calculate the new prices,8221; he adds. There are others who feel that the effect of the budget will be felt immediately, with prices already on the rise.

As of now, there is no uniform increase in costs in the market. While shops in some localities have already increased their prices, others are still waiting for the official word from companies.

Minati Mishra, Mayur Vihar housewife says: 8220;Prices have not increased yet. Though according to the budget the price of skimmed milk is expected to go up, it remains the same at Rs 11. Prices of cereals also remain the same. We are expecting the prices to go up in a week8217;s time.8221;

Kusum Jain, a Preet Vihar housewife adds: 8220;I did not buy groceries from the usual place. As he sells most items loose and has increased the prices. But the standard shops are selling at the old price.8221;

While shops in South Extension, Greater Kailash, Defence Colony, Lajpat Nagar and Bengali Market are selling commodities at the same prices, neighbourhood grocers have taken advantage of the prevailing confusion and increased their prices all in the name of the budget.

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8220;There has been no immediate increase in the prices of rice, dal, tea and other essential commodities,8221; explains the man at the counter of Krishna Stores in Bengali Market. 8220;Prices had already gone up a week ago in anticipation of the budget. Premium quality Basmati rice which cost Rs 40 per kilo gram now costs Rs 45.8221;

The increase in import duty is also likely to affect the cost of pulses. 8220;The shortage in pulses is met by import orders. Increase in import duty translates into increase in the cost of moong dal, arhar dal, rajma etc,8221; explains Padam Chand Gupta, a trader in the old city area.

However, shopkeepers clarify that the actual effect of the budget will be felt only after 10 days. 8220;The companies will first work out the new cost and then the distributors will be informed. Only then will the budget translate into an increase in the cost of essentials,8221; says Rajan, a shopkeeper in East Arjun Nagar.

An average middle class household spends approximately Rs 2,500 on provisions alone. With prices of fuel going up, there is likely to be a proportionate increase in the cost of vegetables and other commodities.Added to this is the 15 to 100 per cent increase in water tariff, Re one increase in petrol and the rise in postal rates and cigarettes.

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