The Hindu Business Line : Per capita cereal consumption drops 20 pc

CITING NSS (National Sample Survey) data, an International Food Policy Research Institute paper states that per capita consumption of cereals in rural India dropped from 192 kg to 152 kg per year between 1977 and 1999, even as the consumption of fruits, vegetables, milk and milk products and meat, eggs and fish increased 553 per cent, 167 per cent, 105 per cent and 85 per cent respectively.

Given the rise of cereal prices between 1977 and 1999, it is quite possible that householders ended up spending more money on cereals despite the sharp drop in their consumption.

However, it does not seem that the drop in per capita cereal consumption was caused by an inability to pay for the desired quantity.

As pointed out a few years ago by Prof C.H. Hanumantha Rao, in a landmark paper `Declining demand for foodgrains in rural India: Causes and Explanations', the quantity of grains consumed was declining apace with a rise in real per capita income.

Generally speaking, this paper found that the poor were able to hold on to their former consumption levels, if they chose to do so, but preferred to alter their consumption baskets in favour of other items of consumption, both food and non-food.

The absolute drop in the per capita consumption of cereals in quantity terms was particularly pronounced as one moved from the lower to the middle levels of per capita consumption expenditure. This general picture is corroborated by the way in which FMCG majors with a rural presence are keenly following the progress of the southwest monsoons.

In most parts of the country, the onset of rains is accompanied by markedly higher wage payments for pre-sowing, sowing and post-sowing agricultural operations. Many more people find employment at this time of the year, and at higher wages.

But farmers have to wait till harvest time to reap what they have sown. Presumably therefore, it is the demand from the huge number of people belonging to relatively low consumption groups that FMCG majors are hoping to cash in on. Those higher up the income scale no doubt have more purchasing power. But their numbers are much smaller.

And, after all, there is a limit on the number of soap cakes or bags of detergent or shampoo sachets that one household can be expected to consume.

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