The logical reason for the disparity in the hike is the inflation. People who work in IT companies in India, get Salary hikes ranging from 15% to 30% every year, where as in America the average hike per year in salary is around 3%. Logically, what is happening is, due to inflation in India prices are going up crazy and the effective buying power of a rupee is decreasing. In India, the inflation rate is over 10% or hovering around there…whereas in America, the inflation is under 2% and there was deflation in USA during recession. If you look at both of these graphs, you get a clear idea of the inflation rates based on consumer price index. Inflation of USA vs India, Economy growth rate. This article is part of the series Settle in US or India and will focus on inflation, cost of various things and how things are changing in America vs. In general, it is not logical to compare both currencies as their value is different, but just trying to explain the perceptions of people about currency. I tell the price in dollars…when I complain about prices of few things in America, she replies saying, “for you guys living in America, one dollar is equal to one rupee…so it is ok…” I right away reply to my mom, “A dollar is never equal to rupee…the buying power of one Dollar is much higher than a rupee in India.” I quote an example saying, “in America, people can get a cheap cheese burger for a dollar or even cheaper taco in taco bell for 80 cents or so…but, what can you buy for a rupee in India…Nothing ! ”. When I call my parents in India, my Mom asks about prices of vegetables, clothes and other stuff in US.
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