From milk to ACs, everyday essentials getting costlier as war fuels inflation

From milk and packaged foods to air-conditioners and restaurant meals, rising fuel and commodity costs linked to the ongoing global conflict are beginning to hit everyday household spending in India.

Companies across sectors have already implemented at least one round of price hikes and are preparing for more as energy supply disruptions continue to push up input costs.

The recent fuel price hike is expected to further strain household budgets, especially for low and middle-income consumers. High LPG prices are also impacting eateries and food businesses, while the rise in gold import duty — introduced to curb foreign exchange outflows — is likely to make jewellery more expensive.


Consumer goods companies have already started passing on rising costs to customers. Tata Group-owned Voltas said during a recent earnings call that it had already increased prices and remains open to further hikes if needed.

According to Times of India, Blue Star has raised AC prices by around 5% due to energy-efficiency norms and another 8% to offset higher raw material and exchange rate costs. Air-conditioner makers were already dealing with elevated commodity prices, especially copper, before the war intensified inflationary pressures.

“Let us say, tomorrow petroleum prices increase….and inflation peaks during this period, consumer sentiments may force them not to spend,” B Thiagarajan, MD Blue Star, said in an earnings call earlier this month.

Analysts cited in the report expect retail fuel price hikes to push headline inflation up by around 10-25 basis points in the coming months.

Dairy giant Amul, which recently increased milk prices by Rs 2 per litre, said the cost of cattle feed, packaging material and fuel had risen significantly over the past year.

FMCG firms have also announced price increases across categories. Godrej Consumer Products has increased prices by 4-7% across soaps, detergents and household insecticides, while Marico has raised prices by around 6-7%. Hindustan Unilever has implemented hikes of 2-5%, with more increases likely, the report said.

In the paints segment, Asian Paints has reportedly taken two rounds of price hikes amounting to 9-14% overall.
The report also noted that higher gold import duty could impact jewellery demand in the near term. Amit Modak told TOI that sudden policy changes and rising prices may push consumers to delay non-essential purchases for some time.