NEW DELHI: Costs of education and health services have risen much higher than the retail, or consumer price indexed (CPI) inflation for September, the Associated Chambers of Commerce and Industry of India (Assocham) said.

"With severe shortages of education and health facilities in the public sector, the middle class has to depend on private sector schools, colleges and hospitals and their costs have become quite high," the industry chamber said in a statement here.

"While the annual increase in prices of these services may not show huge rise, the base price of such facilities is so high that it is becoming increasingly difficult for a large number of people in cities and small towns to afford them," said Assocham secretary general D.S.Rawat.

He also urged that public expenditure on health and education be raised significantly, both at the central and state levels.

The Assocham study showed that prices of goods and services consumed on a daily basis are growing beyond the comfort level for most Indians.

Other items of middle class consumption like meat, fish, milk and milk products, have also seen significant price increase of between 5 and 5.5 percent.

India's retail inflation for September increased to 4.41 percent, from 3.74 percent recorded for the previous month, on the back of higher food prices.

Overall food inflation was higher in September, at 3.88 percent compared to 2.2 percent in August.

Contributing most to food inflation in September were pulses, which were costlier by nearly 30 percent, followed by meat, fish, milk and milk products, the CPI rates for all of which were over 5 percent.

"While the RBI has in the last instance reduced the policy rate by 50 basis points, the average transmission is not above 30 bps despite so much of prodding by the government and the Reserve Bank of India," Assocham said.

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