Middle-class Indians tighten belts amid spike in inflation

Surge is driven by rising food prices, adding pressure on household budgets

- Nirmala Ganapathy

Mr Omji Dubey now restricts himself to dining out only once or twice a month.

The resident of Gurugram, a satellite city of Delhi, used to eat at a restaurant every weekend, which can cost upwards of 2,500 rupees ($39.80) for a meal for two.

Mr Dubey, who works in the information technology sector, has also reduced his consumption of packaged, ready-to-eat food items in exchange for home-cooked meals, which are cheaper.

"Even so, my salary is barely enough to make it to the end of the month," the 22-year-old bachelor told The Straits Times. The average starting monthly pay in India's IT sector is around 40,000 rupees.

A spike in retail inflation in India, which hit a 14-month high of 6.21 per cent in October, has put a squeeze on the middle class, forcing millions of people like Mr Dubey to tighten their belts.

The surge has been driven by food inflation, which hit 10.87 per cent in October, adding even more pressure on household budgets.

In particular, a spike in vegetable prices of 42.18 per cent in October compared with the same month in 2023 - after a 36 per cent rise in September - is causing acute distress to many households.

A large section of India's urban middle class - which has been estimated to account for around 30 per cent of the country's population of 1.4 billion people - is looking for ways to rein in their spending.

This is even more so in the country's large cities like Delhi, Mumbai and Bengaluru, where everything from eating out to renting a flat is more expensive than in smaller cities and rural India.