Poor Monsoon Could Further Fuel Inflation: Ipsos Study

Vast Majority (82%) of Indians foresee higher inflation due to less than adequate monsoon this year, according to the ‘Mood of the Nation Survey’ conducted by global research firm Ipsos.  
 
According to the Ipsos survey, almost 92 percent Indians have felt direct impact of inflation on their household expenses. To tackle inflation and manage expenses respondents polled say that they will postpone holidays (47%) and defer spending on big ticket items (35%). They also plan to spend less on eating out (33%), and buying branded clothes (31%). Many of them will be using more of public transportation to save expense on fuel (43%). 
 
“With monsoon being scanty this year and inflation continuing to rear its head, consumers are feeling the pinch of rise in prices. Ipsos survey results indicate 81 percent consumers are tightening their purse strings and curtailing spends on non-essential items. The mood of the nation is clearly of cautious optimism with widespread rains in certain part of the country in recent days,” said Biswarup Banerjee, Head of Marketing Communication, Ipsos in India.  
 
Respondents polled feel to rein in food prices; government should reduce import duties (53%), import certain essential food commodities which are in short supply (35%), ban exports of items in short supply (30%), impose stock limits on commodity traders (27%) and more than 20 percent people think combination of all the above measures would help in ensuring there are enough supplies and moderate prices during the festive season.  
 
“There were serious worries that the week monsoon will undermine significant driver of the economy, but the improving rains will provide some relief to the country battling high inflation, declining growth and threat of a credit rating cut to junk status. We still need to wait and lookout for the September rains to get a clearer picture, but the scary scenario is clearly gone providing a little breather to beleaguered government," add Banerjee. 
 
Ipsos ‘Mood of the Nation’ survey was conducted between August 13 - 16, 2012 among 400 men and women in Delhi, Mumbai, Kolkata and Chennai. 
 
 
More than four in ten (43%) Indians are cautiously optimistic about the future; with equal percentage of people believe P. Chidambaram will be a better Union Finance Minister of India.  However, the opinion poll bought out mixed views. Citizens of Kolkata, Delhi and Mumbai have more number of respondents batting for P. Chidambaram, while a majority (69%) of the respondents in Chennai disagrees.     
Thirty Eight percent Indians believe Chidambaram will be able to tame inflation and infuse confidence among investors and 45 percent people think he will fail. However, city wise differences emerge, with Delhi and Mumbai more positive about FM’s capability.  
 
Indian citizen across cities think the top priority of Finance Minister should be to reduce inflation (30%), create environment for growth (20%), restore investors’ confidence (19%), bring government finances under control (18%), and increase job prospects (13%).    
 
A big majority (61%) people believe that the UPA government will not be able to deliver on its promises before the next scheduled general election in 2014. 
Seven in ten (71%) Indian citizen think that the country is heading for worse times ahead. Sixty Nine percent Indian think that a large country like India should have zonal in charge to manage the Home Ministry portfolio – 4 separate home ministers for North, East, West and South of India to focus on law and order issues in view of the recent violence in Assam, Mumbai and exodus of people belonging to North Eastern states of India who resided in Bangalore, Hyderabad and Pune.
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