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What are the key factors that contribute to the surge in food prices in India

The nationwide surge in food prices indicates that retail inflation is far from tamed. Identify the factors that are responsible for this price surge.
There are several key factors contributing to the surge in food prices in India: 1. Supply and demand imbalances: Fluctuations in crop production and poor agricultural yield due to unpredictable weather conditions, such as droughts or floods, can lead to shortages in supply and cause prices to rise. 2. Transportation and logistics costs: Rising fuel prices and inadequate infrastructure can increase transportation costs, resulting in higher prices for essential goods like food. This is especially significant for perishable items, as delays in transportation can lead to wastage. 3. Global commodity prices: India imports various food items, and fluctuations in global commodity prices, such as those of crude oil or essential commodities like wheat or pulses, can impact domestic prices. 4. Inflationary pressures: Inflationary trends, influenced by factors like monetary policy decisions and increase in minimum support prices for crops, can also contribute to higher food prices. 5. Trade policies: Restrictions on exports or imports, such as bans or quotas, can disrupt supply chains and escalate food prices domestically. It's important to note that these factors can vary in their impact and intensity over time, further influencing fluctuations in food prices.
Answered 2 years ago
Amrita Aspirants