Return to INDIA (R2I as they say) !! – Part 5

The expensive new world and the inexpensive old world

Most folks coming back to India or rather to be more specific Bangalore, would say that it has become outrageously expensive to live here. There is definitely a lot of truth in that statement.

Daily lunch in a decent restaurant such as Shanti Sagar/Sukh Sagar costs around 200-250 bucks for the two of us. A cab trip from one part of the town to another costs you close to 300-400 bucks. I have heard that a movie outing would loosen your wallet by at least 500-1000 bucks (though we haven’t had a chance to go out..too busy settling in). Baristas and Coffee day would easily throw you back by 100-200 bucks for the bare minimum. When it comes to big-ticket items, a 42+inch LCD TV costs 60K-1 lakh for good brands; LED’s cross the lakh mark. (but still if you are coming back, don’t buy a TV there, buy it here. You will help the economy here + the customs guy will slap a 15% duty anyways + LCD Tv’s are the most stolen item during shipping)

Our good old desi cars in the US – the Honda civics, city et al are the top-notch cars an urban middle-class double income family can think of buying at this time. They range from 6-7 lakhs for the Jazz model to 10-15 lakhs for the city/civic models. House prices are the killers. A good three bedroom in a good locality with good amenities would cost you at the very minimum 70 lakhs !!  It’s very common to see crore plus advertisements for apartments. Here’s the icing on the cake. The supposed good pre-schools and kindergartens cost upwards of 70K/annum. My whole of engineering including tuition, mess bill, hostel fees and miscellaneous items did not cost my dad more than 2 lakhs and here they are talking about first grade for a lakh/annum !!

Now I am sure you would have heard these numbers before from people here. I had heard it too. But sitting in the US you can’t help but actually feel a little bit proud that India is growing (inflation most of the times is seen as a sign of growth). Also with the USD salaries there all of these would seem reachable, but trust me once you land here and put all of these things together you would see the plush INR salary that you negotiated and which you thought should hold good would no longer seem enough.The problem is that these prices are comparable with the US prices and in many cases equal in terms of absolute conversion. But in terms of cost of living index, the prices kill you.

A good mattress in the US costs $600 which for a $80K plus income turns out to be 1/8th of the monthly take home. Here the same thing costs Rs 20K which is 1/3rd of a comparable salary. These are the numbers that I am staring at in the next few months -

Rent-20000

Electricity-500

Gas-650

Maid-2000

Driver-6000

Petrol-4000

Cell Phone Bill=1500

Landline-500

Internet-850

Cable-500

Groceries-5000

Entertainment-5000

Miscellaneous-5000

Total Rs 51,500 (God help me !!)

If you buy a house and take a loan you can change the rent above to 1/100th of the loan you take. So say you take loan of 50 lakhs, then your mortgage would be around 50K which brings your expenses close to 1 lac/month which in turn requires a salary of at least 22-25 lakhs/annum. Remember this means no saving except for your house.  Did I just prove that a 22-lakh/annum salary means no saving? Welcome to the new INDIA. I hope these numbers help people in their salary negotiations depending upon their lifestyles.

Now of course, this is the expensive side of Bangalore and the lifestyle that we chose to live. Coming back from the US, you are in the NRI mode and you tend to close the gap between what you chose to leave back in the US with what you get here. In trying to close the gap you tend to lean towards the premium aspects of the Indian society and therein lies the quandary.  But there is also the inexpensive side or the old Bangalore. You could very well live in Bangalore by spending half the amount mentioned above. You could rent a house for 5k, 10K, 15K or even for 50K. You could chose not to have maids or drivers. In fact, maids and drivers are a luxury in the US. You could avoid going to the malls and shop in the local market. You can avoid the cabs and take the volvo buses (fantastic buses they are by the way). You could buy your groceries from the local bania instead of going to MORE or Big Bazaar.

But I can bet you that you wouldn’t do that when you are here. We (speaking for the new generation) have moved on from the lifestyle lived by our parents most of their lives (In fact our parents have moved on too). We are no longer the penny-pinching kind. We have started living tomorrow’s life today.

I am not sure if this is good or bad. But this is what I see here. Hopefully we have a better end than what US has/is going through.

PS: Debit cards and not credit cards are the norm here. That is in a way good right? You wouldn’t rack up huge credit card bills.