Saturday, October 2, 2010

Twenty kilometers from the Pakistan border*

After visiting the government depot, we made a stop at a privately run retail shop to do some comparison shopping.  Here is what your rupees will buy you in the retail markets:

wheat - Rs 12/kg
flour - Rs 15/kg
pulses - Rs 55/kg (A few months ago, however, pulses were going for Rs 90/kg)
kerosene - Rs 20/L

The shop owners purchase provisions from three different sources: directly from the markets; through commission agents; or from the farmer.  Business directly with farmers comprises a small amount of the owner's procurement practices.  This is in large part due to the fact that when he buys from the farmers, the owner has to buy his entire purchase at one time and store it in his shop (Lack of storage seems to be a consistent theme in India.  I need to figure out why no one is trying to make money on storage units for commodities.).  If the farmer's crop fails, the owner charges interest on the advance given to the farmer when the contract is drawn up at the beginning of the season.   

*I am writing this in the dark as the electricity has gone out.  Welcome to the 21st century.  It's remarkable that the internet, which has been in India for less than a decade, is more reliable than electricity.

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