Control Begins at Home

Meet one of our new Guest Writers Vikram A Munshi, a Gurgaon based Management Consultant (Healthcare & Life Sciences) who shares a thought provoking article on rising prices and inflation with us. This 40-year-old is a father of two beautiful children, is a huge Wilbur Smith fan, who loves spending time with his wife and kids, reading and traveling. After a 15 year stint at top pharmaceutical companies, Vikram has branched out on his own as an independent consultant. Here’s what he has to say about battling inflation and how we can control it.

Battling Inflation Begins at Home

I am not a statistician. Nor am I an economist or even an Industry top honcho. Nor am I anyone backed by reams of data on economic growth, consumer purchasing pattern etc. I am an ordinary upper middle class person staying in India’s most expensive city: Gurgaon.

To me Gurgaon used to represent the shining beacon of New India’s global ambition. Its cosmopolitan culture inspired me for most of the seven years which I have spent here. So much so was I blinded by Gurgaon that when my company decided to relocate to Mumbai, I chose to resign from my high paying job to set up my own consultancy practice here.

I do not regret the decision of not moving to Mumbai. Yet in the last one and a half years the rose colour of my glasses seems to have faded somewhat. Off late I am noticing the cracks behind the spectacular growth story of this millennium city. This disturbs me as I see this impacting India’s future in the long run.

In the new India’s coming of age which I see through Gurgaon, I draw a parallel to America’s evolution. America, the erstwhile land of opportunity where hardy pioneers braved unknown dangers and an extremely hostile environment to give birth to a new nation. America also has a tumultuous history , the Civil War , the Great Depression , World War 2 , the Vietnam war , the political assassinations to name a few. Yet it was this pioneer stock which set the foundation for America’s leadership in innovations.

Be it the car, telephones, railroad, heavy engineering, space exploration, office machines, Entertainment, Computers it was America which set the trend. I think all this innovation was fuelled by need. Need of a country, need of an individual. A nation had to be built from scratch and somewhere the building process brought out the best in its citizens. Today when we think of America, these images may not come to our mind. Today when we think of US, we may think of the recession; a fall out of the subprime crisis. It brought to light the extent of the rot which had seeped into corporate America. A nation which a few decades back had led the world in manufacturing innovations today manufactures the highest number of Lawyers and MBAs.

There may be many reasons for this erosion. I think this simply happened because Need was substituted by Greed.

Greed is dangerous. It is a cancer which kills its own host. Greed is fuelled by instant gratification. And it is this evidence of moving towards instant gratification which I see happening in front of my eyes. I see it invading our society and eroding our robust value systems inherited from our parents.

We blame inflation and corruption as some of the biggest banes in our lives. Both are driven by greed. ”Corruption, Yes…but inflation? No, not possible. That is the Government’s fault. I am a victim of inflation!” we exclaim.

Let me explain. I understand inflation as a mismatch between supply and demand. Too much money chasing too few things.

Let us look at demand factors with 4 examples which I have observed in Gurgaon.

1^st example: Over the last 1 year I have noticed that the number of cars in my block seem to have doubled. Yet more than 50% of the cars remain in their parking bays every working day. It seems we are purchasing more cars but not using them.

2^nd example: At a hypermarket in my locality I see shoppers piling the shopping carts with big bottles of soft drinks , chips , snacks amongst other things and then queuing up to pay with a credit card and that too on the last days of the month.

3^rd example: While taking a morning walk at 7 .00 am, I routinely see some parents sitting with their children waiting for their school buses with the car engine idling and the ACs running. I was of the opinion that the petrol prices affected everyone.

4^th example: I see young couples purchasing 3-4 bedroom flats in Gurgaon for Rs.1 Crore and above without batting an eyelid on a combined annual income of Rs.20-30 L.

In all the 4 examples I see Greed as more of a driving force than Need. This has me worried. We are consuming more to fulfil our greed. Some of you might say so what? The disposable incomes have gone up so why should an individual not have the right to enjoy life in his or her way?

My question is that are we capable of handling this high income? I think the answer is no.

I recall in the 1980s when the Maruti 800 hit the Indian Roads, there was a steep increase in the number of road accidents in Delhi. Indians brought up on a diet of the leisurely moving Fiats and Ambassadors, found the rapid acceleration power under their feet exhilarating and they just could not control it. It was then; speed limits were imposed on the Delhi Roads. An external measure to impose control on human behaviour.

In inflation too, the government is trying to impose external speed limits in terms of hiking interest rates, but the main control for inflation is in our hands. We can choose to live our lives with things to fulfil our needs. Spend on what fulfils our need and not what fans our greed. Conservative living does not mean Spartan living. It just means living happily well within our means. It means buying 1 television set which the family can share. It means showering our families with love and time instead of gadgets and gizmos. It means being a parent and passing the same core values which were passed us on to us by our parents. I think if each of us takes even one small step in this we will see the impact if not in terms of increased savings then definitely in terms of increased happiness.

I think conservative living will also impact the supply to some extent. At least voracious real estate companies will think twice before acquiring agricultural land at dirt cheap prices to build high end residential complexes which we rush to buy and pay with our souls to keep the EMIs from piling up. Let us not become another America. It is up to us actually.

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