Rising prices were one of the issues which came to the forefront during the last general elections, apart from other things like corruption, non-governance etc. and perhaps it also decided the course of the result. The vocal middle classes, concerned with the sluggish Indian economy, compared to earlier years, were restive and wanted some control over the crazy price escalation, while the business classes vied for opening of the economy in a way where ease of doing business was promoted. The country had generally escaped the global meltdown but the other two scenarios were grim; though to some extent these continue to be so even now.
leaving aside other issues for the present, price rise has always been a major worry that affects the middle class and salaried classes and wage earners. The upsurge in the price of onions is being felt again and it s apparently going to last for some time, unless, post-election, it has stabilised at this level and the current prices are the new price threshold. What is however, more disturbing is the continuous rise in price of groceries and all common items of daily use of the consumers. The question we need to ask is whether this phenomenon is also affected by general price rise or it is a function of business malpractices.
We may recall the ever-increasing MRP tag on each item of daily consumption with alarming regularity, causing distress to the common people. It is almost certain to find revised MRP on common items of daily use every time you visit the store. No two stocks, separated by couple of months, will have the same price tag. One more distortion that is noticed is, varying volume or content of the same item, even while revising the cost upwards. Thus, for example, the weight of an item is reduced from 250 gm to 225 gm or from 200 gm to 180 gm in a new stock but the price (on the package) most likely would still stand revised to a higher level. This is like hitting the consumer twice. Thus she carries less quantity home than she carried earlier, albeit and ironically for a higher price. This trend is commonly noticeable across various items of daily consumption.
Keeping a tab on prices as a measure of public welfare and market stability has been in vogue from old times. Right from the ancient and medieval times there have been instances of price regulations and control by the rulers. We hear such references in Kautilya’s Arthashastra. later, Ala-ud-din Khilji, one of the medieval monarchs enforced an effective price regulation in Delhi markets and went about this enforcement very meticulously. The problem is not routine price rise but it’s alarming frequency and it’s pervasive reach across all sectors of the consumer market. To the extent that even fall in oil prices has no positive consequence on the price line. The prices were generally stable in Indian markets until recently and fluctuated mostly seasonally or during
extraordinary situations like in times of shortages arising from drought, war, etc. Further, following the reforms and opening of the Indian economy through liberalisation and globalisation, frequent fluctuations in prices were much less rampant than they are now.
We, therefore, need to understand whether there is a regulatory framework available to control such malpractices, and if there is one, what is it like. Since, we have the Department of Economic Affairs, which perhaps exercises some kind of authority on such areas of public policy, we need to know whether some checks and balances are available that can be enforced on the Business and Industry for the purpose of giving the consumers a better deal. This concern goes beyond the Consumer Protection Act and the safeguards provided their under; neither here we highlight reference to regulations governing weights and measures etc. What is intended to be referred here is the deliberate circumventing of the law through dubious means as explained through an illustration of double loss to the consumer — downward weight and upward price — that apparently is not violative of the law and therefore, not punishable.
As mentioned earlier, both the weight and price of consumer items are being frequently varied by the manufacturers — without any real adversity to the traders or the middlemen etc. who have the cushion to bear such increases but quite to the detriment of the common people — giving strong suspicion of an unfair business practice being indulged by industry. Such uncertainty and arbitrary pricing of basic essentials does not look good (for achchhe din) in a robust functioning democracy. It is logical that this aspect needs to be looked into appropriately and at length for devising a suitable mechanism to deter and reverse such frequent upward revision of prices of consumer goods and to put some control on the industry through monitoring, feedback and proper enforcement in the larger public interest. In case, an enabling clause is not available, the Government may even consider invoking law provisions to check malpractice.