South Asia is one of the least expensive regions in the world for expatriates, particularly those who are working on a generous international salary. Consequently, most foreign nationals in India can afford to enjoy a good standard of living, although demand for high-quality housing and accommodation has risen sharply in recent years with prices following suit. Cities are typically more expensive than rural areas, but for domestically-produced consumer goods the distance to production areas also has an impact on pricing.
There are some restrictions on foreigners purchasing property in India. People from many of India’s near-neighbour countries are barred from purchasing property there, while people intending to live outside India must hold documentary evidence of their Indian heritage to purchase property. Even for foreign nationals who work and reside in India, various other restrictions apply, so the vast majority rent property instead. There is no shortage of cheap accommodation in India, however quality can be an issue so many expats end up paying more than they anticipate to secure the type of housing they expect. Typical rental contacts run for 12 months, but many landlords will push for an 11-month deal as this exempts them from rental control laws. To rent or buy property in India, it is almost essential to use an estate agent, so expect to pay a hefty percentage in fees.
Landlords are free to set their own deposits, so while two or three months’ rent is probably the average, it is not unheard of for people to be charged six months of rent or more as a deposit – a problem exacerbated by a willingness amongst expats to pay such figures to secure a better standard of accommodation.
Property owners are liable for property tax in India, and depending on the state the charge is accompanied by levies for municipal services. This charge is calculated based on the market value of the property, the rental value of the property, or the rent received for let properties. For rental properties the owner may pass on the cost of the tax to the tenant. If the owner is a permanent resident of the property, the tax rate may be zero.
Somewhat uncommonly, many Indian landlords will organise the provision of electricity, gas and water to their properties. Costs may be included in the rent or billed separately. If you need to arrange your own connections, mains electricity and water are usually supplied by local state-run companies, although supplies can be sporadic. Tap water is not considered safe to drink in India. Most gas is bottled rather than delivered by mains connection. Telephone and internet services are not usually part of a rental agreement, so you are free to shop around for the best deal – a list of suppliers is available on the Telecom Regulatory Authority of India website.
The television licence was abolished in India in 1984 and the industry is now funded largely by advertising. There are a mixture of free-to-air and paid TV channels, with terrestrial services provided by state broadcaster Doordashan in a mixture of Hindi and English.
Healthcare and medical costs
India does provide some free healthcare, however this is limited and costs can mount up quickly even for minor ailments. Most foreign nationals who live and work in India therefore take out private medical insurance. Mediclaim policies, a tax-deductible insurance product regulated by law are one option, but cover is limited. If you can afford to take out a more comprehensive insurance scheme, or your employer offers one as a benefit, it is well worth taking up.
Indian cities have a great choice of shops from family businesses to international stores. In rural areas, choice can be more limited but smaller businesses leave you more room to negotiate on prices. Markets are a great place to shop whether you are in the country or the city – just be prepared to haggle!
Unlike many countries, India’s value-added tax is administered at a state level rather than nationally. First implemented in 2005, it was initially adopted by just a few states, but is now applied almost across the board at varying rates. Separate sales tax also applies on many transactions.
- Rent on 1-bedroom apartment in city centre – INR 9,119.47 (≈£95.80) per month
- Rent on 1-bedroom apartment outside city centre – INR 5,700.62 (≈£59.89) per month
- Price of apartment in city centre – INR 70,147.96 (≈£736.95) per square metre
- Price of apartment outside city centre – INR 38,090.20 (≈£400.16) per square metre
- Loaf of bread – INR 24.30 (≈£0.26)
- Milk (1 litre) – INR 40.26 (≈£0.42)
- Bottled water (1.5 litre) – INR 25.36 (≈£0.27)
- Draught beer (0.5 litre) – INR 90.00 (≈£0.95)
- Packet of cigarettes – INR 140.00 (≈£1.47)
- Petrol (1 litre) – INR 73.84 (≈£0.78)
- Cinema ticket – INR 200.00 (≈£2.10)
Source: www.numbeo.com (accessed March 2015)