With the rise in key policy rates by 12 consecutive times since March 2010, the borrowing cost for the companies have also gone up which has led to slowdown in India's manufacturing sector.
At present, manufacturing inflation stands above 7.5%, which is still quite high.
Revision in prices by LG India would be for refrigerators, washing machines and colour TVs.
“Our raw material costs have gone up in a big way and we are going to adjust this by increasing prices. This revision would happen for refrigerators, washing machines and colour TVs," YV Verma, chief operating officer, LG India, said.
Another spike is rise in oil prices which has lifted up transportation cost for the companies.
Fall in rupee against dollar is also another setback, raising import cost for the companies.
Farm equipment major Mahindra & Mahindra (M&M) will also raise price of tractors by 1.5% due to rise in input costs.
Mahindra & Mahindra Chief Executive, Tractor and Farm Mechanization Business, Bishwambhar Mishra stated, "We will raise price of our products (tractors) by 1.5% in a month or so."
Material cost had gone up by Rs 45,000 – Rs 50,000 per tractor in the period of two years, so it is necessary to pass on some cost to the consumer, company added.