Indians spending less on food, more on discretionary items

According to a survey on Household Consumption Expenditure in India, it has been found that Indians are spending less money on food and more on discretionary items. The survey reported a rise in average rural consumer spending to Rs 3,773 per month per person, compared to Rs 1,430 in the previous survey conducted in 2011-2012. Urban spending also saw an increase, rising to Rs 6,459 from Rs 2,630. Spending on food has decreased, with rural consumers allocating 46% of their monthly consumption to food, down from 53% in 2011-2012, and urban consumers allocating 39% compared to the previous 43%. Instead, Indians are now spending more on processed food, beverages, and durable goods like televisions and fridges. This shift in spending habits comes at a crucial time, as India prepares for its upcoming election and the government is under scrutiny for potential data concealment.

Overview of the survey findings

The recently released Household Consumption Expenditure Survey reveals some interesting trends in consumer spending in India. There has been an increase in consumer spending on discretionary items, while spending on food items has decreased.

Increase in consumer spending on discretionary items

The survey shows that Indians are spending less on food, particularly staples like rice and wheat, and more on discretionary items such as processed food and durables like televisions and fridges. This shift in spending patterns highlights changing consumer preferences and a growing demand for non-essential items.

Decrease in spending on food items

The survey also indicates a decrease in spending on food items. For rural consumers, spending on food fell to 46% of monthly consumption compared to nearly 53% in the previous survey conducted in 2011-2012. In urban areas, food spending fell to 39% from 43% in the previous survey. This decline in food spending may be influenced by a shift in food consumption from cereals to beverages and processed food.

Rural consumer spending

The survey findings show that average rural consumer spending has increased considerably. The data reveals that rural consumers are now spending an average of Rs 3,773 per month, compared to Rs 1,430 in the previous survey conducted in 2011-2012. This significant increase in spending demonstrates the rising purchasing power and improved living standards of rural households.

Comparison with previous survey results from 2011-2012

It is important to compare the current survey findings with the previous survey conducted in 2011-2012 to gain a better understanding of the changes in consumer spending over time. The data clearly shows that there has been a substantial increase in both rural and urban consumer spending since the previous survey.

Urban consumer spending

Similar to rural consumer spending, average urban consumer spending has also witnessed a significant increase. The survey reveals that urban consumers are now spending an average of Rs 6,459 per month, compared to Rs 2,630 in the previous survey. This rise in urban consumer spending can be attributed to factors such as increased incomes, urbanization, and a shift in lifestyle preferences.

Controversy over data quality issues

The government’s decision to not release the 2017-2018 survey due to “data quality issues” has sparked controversy. Some have raised concerns that the government may be concealing economic data, while others believe that weak consumption trends may have influenced the decision to withhold the data. This controversy highlights the importance of transparent and reliable data in shaping economic policies and decision-making.

Denial of withholding data due to weak consumption trends

The government has denied suggestions that they are withholding the data due to weak consumption trends. It is important for the government to address these allegations and provide clarity on their decision to not release the survey. Transparency and accountability are crucial for maintaining the credibility of government data and fostering trust among stakeholders.

Impact on consumer price inflation index

The new survey findings will form the basis of a review of India’s consumer price inflation index. This review is necessary to ensure that the index accurately reflects consumer spending patterns and changes in the cost of living. The survey data will help policymakers make informed decisions regarding monetary policy and other measures aimed at managing inflation effectively.

Spending patterns on food items

The survey highlights a decrease in food spending as a percentage of monthly consumption. This shift in spending patterns indicates a change in dietary preferences and a growing demand for alternative food options. Indians are spending less on cereals, including wheat and rice, and pulses, but more on beverages, refreshments, and processed food.

Shift in food consumption from cereals to beverages and processed food

The survey findings reveal a notable shift in food consumption patterns, with Indians increasingly opting for beverages and processed food over traditional cereals. This change may be attributed to factors such as urbanization, changing lifestyles, and the increasing influence of Western dietary habits. The shift in food consumption patterns has implications for the agriculture sector and food supply chains.

Spending patterns on non-food items

In addition to changes in food spending, the survey also highlights an increase in spending on non-food items. Consumers are allocating a larger portion of their monthly consumption towards conveyance, consumer services, and durable goods. This shift in spending patterns reflects changing consumer aspirations and the desire for improved lifestyles and convenience.

Implication for upcoming elections

The survey findings have significant implications for the upcoming elections in India. As the country heads to the polls, policymakers and political leaders need to take into account the economic realities faced by different population segments. Stagnant incomes and high inflation in rural areas pose challenges that need to be addressed through targeted policies and measures.

Context of upcoming elections

The upcoming elections provide a context for understanding the implications of the survey findings. Political leaders will need to address the concerns of the electorate, particularly the rural population, who may be experiencing stagnant incomes and high inflation. Understanding the economic landscape and aligning policies with the needs of the population will be crucial for electoral success.

Effect of stagnant incomes and high inflation on rural population

The survey findings shed light on the economic challenges faced by the rural population, including stagnant incomes and high inflation. These factors can significantly impact the standard of living and quality of life in rural areas. Addressing these challenges and implementing policies aimed at improving rural incomes and reducing inflation will be key priorities for the government.

Economic forecast for India

The survey findings provide insights into the economic forecast for India. Despite challenges faced by certain population segments, the Indian economy is projected to grow at a world-beating rate of 7.3% in the current fiscal year and 7% in the next fiscal year. However, it is important to recognize the divergent experiences of different population segments and implement inclusive policies to ensure shared economic progress.

Projected growth rate for current and next fiscal year

The projected growth rate of 7.3% for the current fiscal year and 7% for the next fiscal year is a positive indicator for the Indian economy. These growth rates highlight the potential for economic development and expansion in various sectors. However, it is essential to ensure that this growth is inclusive and benefits all segments of the population.

Divergent experiences of different population segments

The survey findings emphasize the divergent experiences of different population segments in India. While some segments may be benefiting from increased incomes and improved living standards, others may be facing economic challenges such as stagnant incomes and high inflation. Understanding these divergent experiences is crucial for policymakers to design targeted interventions and ensure inclusive economic growth.

Conclusion

In conclusion, the Household Consumption Expenditure Survey provides valuable insights into the changing consumption patterns and economic landscape of India. The survey findings indicate an increase in consumer spending on discretionary items and a decrease in spending on food items. The data also highlights the impact on the consumer price inflation index and has implications for upcoming elections. It is important for policymakers to consider the survey findings when formulating policies and ensure that future surveys continue to provide accurate and reliable data for informed decision-making.