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The cost of living

As an emerging and developing economy, the cost of living in India is generally considered to be significantly lower than that of living in the UK, U.S. or Australia.

The 2018 Mercer Cost of Living Index, which compares the cost of living in 209 cities across the world and explores the comparative cost of more than 200 items (including housing, transportation, food, clothing, household goods, and entertainment), ranked Mumbai (India’s most expensive city) in 55th position, New Delhi (in the precinct of Delhi) in 103rd position and Bangalore in 170th position. The rankings of the three major Indian cities listed compare very favourably with the major UK and US cities, for example, London in 19th place, and New York City in 13th place, whilst Sydney, Australia ranked in 29th position.

The cost of food, entertainment, accommodation, travel, etc. is relatively low in India compared to Europe and North America. However, the cost of imported goods is high, so any expats wishing to retain a significantly Western lifestyle will spend far more in doing so than others who embrace the Indian culture and way of life. Additional costs such as a cook, driver, and cleaner will be expected to be incurred by expats, but the relative cost of domestic labourers in India, as compared to Europe and the U.S., is minimal.

Expats with families will find that the cost of educating their children within the International Schools system is also relatively cheap compared to British private and public schools, with average annual fees for day pupils ranging from Rs300,000 (£3,500 or $4550) to Rs500,000 (£6000 or $7800) depending on age, with fees for boarding pupils at around the Rs750,000 (£8,500 or $11,000) mark, plus extras, e.g. transport, examination fees, etc.

Whether living simply or splashing out, India’s low cost of living should ensure that professional expats and their families can expect to live a very privileged and comfortable life in India.

Saving money

Haggling is very much part of Indian life and, although the haggling approach to purchasing items runs contrary to the expectations of many Western cultures, it is worth understanding the process and being prepared to ‘chance your arm’ by giving it a go.

Before beginning a haggling interaction, expats should always bear in mind that the object is to negotiate a fair price for the item in question, not to rip the vendor off, and that haggling negotiations should be approached with good humour and respect — remember, Indians communicate indirectly, so aggressive, confrontational negotiation styles that might be considered reasonable elsewhere will be deeply offensive to Indians. Also bear in mind that goods should not be touched with the left hand and pointing should be done with the chin, closed fist, or thumb.

Top tips for successful (and fun!) haggling:

  • Do your homework in advance to establish the average cost paid for goods similar to those you wish to buy. This will allow you to begin your negotiations from an informed standpoint.
  • Aim for a 70% reduction and don’t settle for less than 30%. Remember, however, that the vendor is not obliged to sell to you and that haggling is about agreeing on a (reasonable) price that you consider to be fair for the goods offered.
  • Haggling can be a long and involved process. Get the vendor to show you lots of options, and discuss the pros and cons and relative costs of these options. This will demonstrate that you are a serious buyer and should lead to a better discount being offered.
  • The haggling game from the vendor’s perspective may well include detailing their family commitments (number of children, elderly relatives, etc.) in order to obtain a better (higher) final price commitment from you. Again, bear in mind that these are all a genuine part of the negotiation process, but also bear in mind that the details are likely to be reasonably true, so agreeing on a price that is fair to you should take the relative positions of power and privilege between seller and buyer into account.
  • If you intend to make multiple purchases, negotiate on each item separately. Only let on that you wish to buy multiple items once the individual prices have been negotiated, then ask for a multi-buy discount (expect an additional 5% discount).
  • Do not begin negotiation until the price has been amended twice (usually done in writing on a pad of paper). Stay silent and stare at the price on the pad until the price is reduced. Do not stare directly at the vendor since prolonged eye contact is considered very rude in India.
  • Remember that in the closing stages of the negotiation, it may be prudent to touch/tug your ear lobes, as ears are considered sacred in India and touching them indicates sincerity.

Finally, remember that India is like every other country in the world and has its fair share of tricksters and fraudsters. Talk to colleagues, other expats, and neighbours to find out about common confidence tricks, take reasonable precautions to protect yourself and your family and, if you are ripped off, let it go, move on, and don’t let it cloud your Indian experience.

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