1947: When a Delhi-Mumbai air ticket cost more than a gold coin
On August 15, 1947, the front page of Hindustan Times announced in big bold headlines the end of British rule. That day’s edition carried news about the appointment of new governors, Lord Mountbatten addressing the Pakistan assembly, and on India’s sterling balances with the Bank of England. But amid all this lay a discreet advertisement at the bottomright corner of page 6. In it, the Bangalore-based government soap factory requested patrons not to pay more than 9 annas (around 56 paise) for lavender soap and report merchants who were charging extra.
An online search suggests that the price today is up 60 times. And that’s not the only product which has seen big changes in price. If someone wanted to fly from Mumbai to Delhi to catch the festivities at the time of India’s independence, he or she would have paid ₹140 for an Air India flight.
Today a ticket on the same route can cost over ₹6,000. Petrol today costs around ₹67.5 a litre. Back then, it was less than 30 paise. (Delhi to Mumbai)
A look into the archives of Hindustan Times and the advertisements that newspapers of the era carried shows how far prices of some commonly used products have changed. (see chart 1).
The rise in prices of air tickets, however, pales in comparison to the steep rise in the price of gold. Ten grams of gold was cheaper than an air ticket between Delhi and Mumbai in 1947. It cost ₹88.62 then, according to data from the Indian Post Gold Coin Services. That was double what it was even five years ago. At the height of the Quit India movement in 1942, the same amount of gold cost ₹44. Seven decades after independence, the price of 10g of gold has risen more than 300 times to cost ₹28,500 (as of Julyend), nearly equal to that of an economy class air-ticket to London (see chart 2).
The boom in aviation and the proliferation of low-cost airlines have kept air fares competitive, and have aided India in being more connected than ever before. The telecom revolution and the rising availability of power have also helped.
There were fewer than 120,000 telephones in all of India at the time of independence. In other words, there were just 300 phones per million people. Today, there are 900,000 phones per million people.
The increase in power availability has been less spectacular and power consumption in India remains significantly below that of its emerging market peers. Nonetheless, since 1947, power consumption has grown 70 times. (see chart 3)
The pace at which availability of food has grown has been much slower. The total per capita availability of cereals and pulses in India was 394.9g a day in 1951. This had risen to 465.1g per capita a day in 2015. This was mainly driven by an increase in availability (and production) of cereals such as rice and wheat, which benefited from the ‘green revolution’ in the 1960s. The availability of pulses has declined as production has failed to keep pace with population growth. (see chart 4).
The surfeit of cereals has increased dependence on a carbohydrate-based diet, and the lack of cheap protein sources such as pulses has contributed to protein deficiency in the country. These factors have played a significant role in driving India’s nutritional crisis.