India’s elderly cut back on essentials, dip into savings as inflation bites
Compelled to cut down on essential items and dip into their depleting savings, India’s elderly population is facing increasingly abrasive inflation as it becomes a battle for survival.
The country’s retail headline inflation rose to an eight-year high of 7.79 per cent in April, while the average interest rate on term deposits fell to an average 6 per cent from 8.5 in three years, and pensioners switched to risky equities and mutual funds.
Sixty-year-old Delhi-based Goutam Dutta and his wife Sumita Roy are an example, facing the brunt of inflation as it erodes their pockets, changing the way they commute and shop for groceries.
“I used to ride my scooter, but now I have abandoned that because of so high a petrol [price] hike that we cannot afford,” said 58-year-old Roy, who took voluntary retirement more than a decade ago. “So we mostly walk or take public transport.”
Dutta was a diamond businessman while Roy was an employee at Tata Steel before she too retired. Their only source of income is a small pension Roy received. However, this will dry up within a few years, making the couple completely dependent on their gradually diminishing savings.
The economic strain caused by rising inflation is not only experienced by Dutta and Roy but also on a larger scale by the country, especially by those who survive on meagre pensions or lean savings.
Monthly expenses have gone up by nearly 20 per cent in the last few months after a rise in the price of vegetables and fuel and other costs, said Saurabh Bhagat, director at Delhi-based Sheows Old Age Home, a charity that runs three old age homes catering to more than 400.
“A common man cannot think of buying even an apple. An apple was a... you know, has become an expensive thing to buy. Fruits are now expensive items. How do you expect the elderly to get those things when even the younger generation does not,” said Bhagat.
However, according to an economist, there could be a way to alleviate the pressure.
“When a basic thing like energy is taxed, it has a cascading effect on all prices. So, if you lower energy prices other prices will also come down,” said Delhi-based economist Arun Kumar.
Prices of food items, comprising nearly half of the consumer price index, have shot up with wheat, edible oil, vegetables, fruit, meat and tea prices up 10-25 per cent in a year, while cooking gas and petrol prices have climbed by more than 40 per cent.
India’s gross savings rate is estimated to fall around 30 per cent of GDP in fiscal year 2021/22 ending in March, from more than 32 per cent before the pandemic as people have been forced to dip into their savings to maintain their standard of living.