Rising prices of cooking fuel, expensive groceries, high school fees a cause of concern for women
There hasn’t been a significant jump in prices of vegetables and staples, but offtake is slow owing to poor consumer confidence and a sluggish job market
For the past two years, Seeta Devi, who runs a small stall in Amethi’s main market, hasn’t been able to raise the prices of samosa and chai. However, during the period the cost of every ingredient, from potatoes and sugar to tea leaves and LPG, have risen. “I support my family of six, including my four school-going children," says the 45-year-old. “There’s hardly any money left to save despite toiling hard for more than 18 hours a day."
Women running small businesses, as well as homemakers, have been complaining about increasing cooking fuel prices. However, the Union budget presented by finance minister Nirmala Sitharaman on Friday seems to be oblivious of their woes. Instead, the additional excise duty and the road and infrastructure cess of one rupee, each, on every litre of petrol and diesel will only add to the misery. Apart from increasing the monthly transportation cost of households, this would also have a cascading effect on goods consumed on a daily basis.
Indian Oil Corp. (IOC) recently reduced the price of non-subsidised LPG by ₹100 per cylinder on the back of softening international rates, but the prices are highly volatile. The price cut came after IOC hiked non-subsidised cylinder prices by ₹25 (for 14.2 kilograms) in June, making it the fourth consecutive month of LPG price hike in this calendar year.
“I’m disappointed that there is no change in LPG prices and the fuel hike will further hurt us," said Seeta Devi as she prepared dough for the samosas ahead of the evening rush. Devi has spent her entire life in the dusty heartland of Uttar Pradesh, which has practically no large industry, educational institution or new businesses.
Rising fuel prices
A dozen women that Mint spoke to said rising LPG prices were a key concern that the finance minister should have addressed in her maiden budget. Even the Pradhan Mantri Ujjwala Yojana (PMUY), which aims to provide universal LPG coverage by 2020, hasn’t been completely effective as poor households find it difficult to pay for and get regular LPG cylinder refills.
India consumed a record 24.9 million tonnes of LPG in 2018-19, which is 53% more than it did five years ago and 6.9% more than in the previous year. LPG cylinders, even after subsidies, can be prohibitively costly for the poor. Much to the disappointment of many, unlike the previous budget where the government had allotted ₹24,932 crore as fuel subsidies, including ₹20,377 crore for LPG subsidy, Friday’s budget had no sops on cooking fuel. The 2017-18 budget had also allocated ₹2,252 crore for Ujjwala, around 14% of the overall LPG subsidy.
Salma Bano, 37, a domestic help from Dasaipur village in Sultanpur district and a beneficiary of the Ujjwala scheme, said it is a struggle to keep refilling the cylinders. A refill costs ₹500-600 a cylinder. “Cooking gas has definitely improved life, but the refill takes away a chunk of my monthly income of ₹2,000. I have been using firewood for the last two months because I cannot afford the LPG refill," she said.
Many women also said that the monthly budget for food and grocery, including staples, vegetables, fruits and dairy products, was a concern. With the proposed rise in fuel prices, costs may further shoot up.
“A kilogram of any pulse costs at least ₹80. I expected Nirmala Sitharaman to ensure lower food prices," said Reeta Saini, 35, a homemaker from Alambagh, Lucknow. Saini says her monthly grocery bill crosses ₹15,000, and she has to cut back on the frozen snacks that her two children love.
Official data, however, contradicts the perception among homemakers about rising food prices. One of the key achievements of the Narendra Modi government has been its ability to contain inflation, which averaged slightly above 4% between 2014 and 2019, and was at a record low of 1.54% in June 2017.
While there has not been a significant jump in vegetable and staples prices, consumption growth is slow owing to poor consumer confidence and a sluggish job market. According to the ManpowerGroup Employment Outlook Survey, hiring intentions marginally declined by four percentage points compared to the July-September quarter of 2018.
Women running their own businesses expected lower goods and services tax (GST) and access to easy loans for startups in the budget announcements. They were not disappointed with the finance minister announcing that one woman in every SHG (self-help group) will be eligible for a loan of ₹1 lakh under the MUDRA Scheme.
Santosh Om Prakash Pandey, 49, who runs a tiffin service in Gayatri Nagar in Amethi, lauded the initiative. “So many women will have the courage to start something of their own and earn a dignified life given that the government has extended the financial support in the form of this loan."
Sitharaman also announced a simplified GST process with multiple changes, including allowing businesses with an annual turnover of less than ₹5 crore to file taxes quarterly.
“I wish there was an option of annual returns, but the option of quarterly returns is welcome. Free return preparation also would make life easy for many small businesses," said Kiran Tripathi, 38, who runs a consumer durables shop in Amethi. The government also proposed a fully automated GST refund module and replaced multiple tax ledgers with a single form. To reduce the compliance burden, the government will also create an electronic invoice system wherein details will be captured in a central system at the time of issuance. This will be used to prefill the returns to be filed by the taxpayer with no need for a separate e-way bill. It will be rolled out in January 2020.
increasing school costs
The budget, however, was silent about education costs, which remains a major concern for homemakers. Instead, the finance minister focussed on innovation and research in school and higher education. Seema Pandey, 51, a Mathura-based homemaker who runs a YouTube cooking channel, said the rising cost of education in a reputed school remains a pain point for a middle-class family. “A good English school charges an annual fee of between ₹60,000 and ₹80,000. If a single income family has two or three children, it becomes very hard to manage the household budget, let alone saving some money. It takes away the chance of a lower middle-class family to aspire to send their children to good English medium schools."