Inflation : An urban cry

A stubborn high Inflation has become a perpetual phenomenon of India’s daily life. Prices of essential commodities have been rolling high since last four years. Partially failed monsoon is just the latest trigger to it , although prices have been high for last few years despite robust crops repeatedly. Government efforts don’t seem to be taming it in near future and supply side constraints are making it harder to contain its persistence.

Inflation is a complex pro-poverty portent. A sustained rise in the prices of commodities leads to a fall in the purchasing power which in turn increases poverty. It is severely affecting the already grave situation of destitute living in rural as well as in urban areas.

Indian poverty discourses are bit over focused towards rural poverty while urban poverty is catching up fast and it has become a more intricate challenge to fathom with. The intensity of poverty is more severe in urban milieu due to high-cost of living up there. Some 81 million people live in urban areas on incomes that are below the poverty line. At the national level, rural poverty remains higher than urban poverty, but the gap is closing. Urban poverty is over 25 percent and it is projected to reach 50 percent by the end of 2030.

Indian cities have become magnet for internal migration thanks to high economic growth and job opportunities. Rising education is making rural youth inspire for greener pastures in urban markets as rural job market is confined to unskilled labor.  Heavy influx of population in urban areas is a major cause behind the changing levels of urban poverty.

High inflation seems to have a more severe impact on urban poverty levels due to majority of factors exclusive to urban living. Lesser prices of basic food stuff and subsidies make life somewhat easier for rural populace comparatively. Urban living has a host of other factors directly adding to inflation woos. Rented housing and public transport are basic features of city life. House rents are skyrocketing in urban areas while fuel price rises have made commuting highly expensive. Urban masses have to bear the direct brunt services inflation because of their consumption profiles.  

Inflation is increasing misery of urban poor, already  lack access to basic services like clean water, sanitation and health care facilities. Some 54 percent among urban slum dwellers don’t even have toilets and public facilities are unusable due to lack of maintenance. All this result into health hazard which requires them to avail medical-aid and rising medical expenses worsens the situation deeper.

Standards of living are changing rapidly in India with stark variance in income levels. Inflation has increasingly become an urban crisis as city populace has no direct protection from the market vagaries and absence of social security. Urban living has also sans direct government intervention like MNERGS to fight with poverty in cities. India will witness an explosion of urban poverty few years from now If Inflation is not contained.