You are on the Gurgaon-Sohna Road, in the exploding exurbs of Delhi, in what the Easyday retail chain calls a compact hyper-store that is spread over 33,000 square feet. Easyday is the joint venture between Walmart and the Bharti group, and Walmart's laser-like focus on offering the lowest prices is visible before you enter the store proper. Two shopping carts are on display, each with similar packages of daily items of consumption. One cart has goods from Easyday, the other from a rival chain. The computer printouts show that Easyday is cheaper by about seven per cent.
One argument for encouraging organised retailing is that it closes the gap between producer prices and consumer prices by squeezing costs and margins in between. If the theory is correct, it should make sense for you to shop at a nearby chain store, rather than at the local kirana shop. Easyday (where half of all sales are of food items) says that is indeed the case; it claims that its prices are comparable, not to the local retail market, but to the nearest wholesale market. Curious, I asked the Walmart people to work out what it would cost for an average person to get a healthy diet if she did low-budget shopping at Easyday. They used a chart from the National Institute of Nutrition in Hyderabad, which stipulates 2,730 calories for a man doing moderate work, and 2,230 calories for a woman (also doing moderate work). Both numbers are higher than those used to determine poverty-level diets. The calorie count has subsets for the required daily intake of proteins, fats and carbs - all prescribed at comfortable levels. Two weeks ago, food items to meet those nutrition requirements for a man could be bought at Easyday for Rs 32.70 per day, less for a woman.
Calculate the food requirements of a typical five-member family of husband, wife and three children (who have a lower calorie requirement), and the monthly food budget would be about Rs 4,200. If you assume that the family has access to grain from the public distribution system, the figure would drop to under Rs 4,000. A quick check showed that a similar set of food items bought in local retail stores would cost more, sometimes significantly more; so the argument for organised retailing is easily made - though it is not easy to picture a poor family walking into Easyday, which has a mainly middle-class clientele.
How does one square these food costs with our understanding of affordability? The received wisdom is that a poor family spends roughly half its income on food (the average for all categories of people is lower, at about a third). So a family that eats a healthy diet would have a minimum monthly income of about Rs 8,000. Coincidentally, the prescribed minimum daily wage in Delhi for unskilled labour is Rs 7,722 in a month with 26 working days.
In practice, living costs are higher. In semi-slum areas, a small single room and shared toilet rents for Rs 2,000, in many semi-slum areas Rs 3,000. Add Rs 1,000 for a gas cylinder every month, Rs 600 for electricity (the average bill at the 40th percentile), transport, "essentials" like a mobile phone and cable TV, and the occasional medical bill, plus the usual consumables and two new sets of clothes in a year, and you are likely to need closer to Rs 10,000 per month. That's just over the official borderline between "economically weaker section" and "lower income group". A skilled worker or an office-goer (and their families) could qualify for that tag, but I am guessing that anything up to half the city won't make the grade.
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