India’s cheaper than you thought

 

In an overview of prices and price indices of a wide array of goods and services from around the world, Australia emerges as the most expensive big economy overall, while the US is among the cheapest developed countries. The data for the report The Random Walk: Mapping the World’s Prices 2014 by Deutsche Bank has been gleaned both by directly surveying prices posted on the Internet and from secondary sources that have collated such data. To ensure that prices are comparable across countries, products that are standard across countries or have close substitutes have been used.

Brazil remains very expensive for a developing country. However, partly due to exchange rate movements, Australia and Brazil have had their prices tempered in US dollar terms. Similarly, Japan is no longer an outlier in most categories due to a weaker yen and the cumulative impact of years of deflation. There are many cities in the world that are now more expensive than Tokyo.

China remains very cheap in some categories such as car rentals, but in many categories it is steadily converging on US prices. Meanwhile, a weaker rupee has allowed India to remain the cheapest big economy (beer and taxi is cheaper but office space is expensive) in the world despite persistent highest inflation rate. The fact that India still runs a large current account deficit illustrates that being competitive is more than just being cheap.

Though the report includes many countries and cities, only 10 are shown here—Brazil, Russia, India, China and South Africa (the BRICS nations); Australia (the most expensive nation in most instances); US (as the base); and UK, Singapore and Hong Kong (for wider but comparable representation). If more than one city from a country was listed, the most expensive has been shown.

Sumit Kumar Singh

PGDM 1st Year

Source:-Mint