Sunday, January 18, 2009

Rickshaw economics

One time in Chennai, when I had a rickshaw driver with good English, I struck up a conversation about how his job works. Here's what I found (when I left India $1 was equal to about 48 rupees):

He pays the owner of his rickshaw 220 rupees per day for the use of the rickshaw. He is also responsible for minor repairs-- things that cost 50 or 60 rupees to fix. If something major goes wrong, he'll return the rickshaw to the owner, who will take care of repairs.

He also pays for his own gas, and normally uses 5-6 liters per day at around 50 rupees per liter. So, in total, it costs him around 500 rupees a day to operate the rickshaw.

He aims to make around 800 rupees a day in fares. My normal ~3.5 km trip from home to my lesson generally cost 50 rupees in a rickshaw and took 10-15 minutes in traffic. Subtracting the operatic cost normally leaves him with take home pay of around 300 rupees. He works 7 days a week, since he has to pay for every day he has the rickshaw, even if he is not working.

So, if he reaches his goal of 300 rupees profit 30 days a month, his monthly income will be 9,000 rupees. In dollars, that's an annual wage of around $2,250. And that's why call center workers who can make 30,000 rupees a month consider themselves well-off.

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