Consumers still spend most on food

Our Bureau New Delhi | Updated on March 12, 2018

Average rural Indian household to have allocated 53.6 per cent of its total monthly consumption expenditure on food items.


Inflation effect

Sustained food inflation in recent years seems to have taken a toll on consumer spending, going by the results of the latest household consumer expenditure survey by the National Sample Survey Organisation (NSSO).

The NSSO's 66th round survey, covering the period from July 2009 to June 2010, shows an average rural Indian household to have allocated 53.6 per cent of its total monthly consumption expenditure on food items. The corresponding share for urban household was less, at 40.7 per cent.

But what is striking about the data — based on a nationwide sample of over one lakh households — is that the decline in the share of food in total consumer spending is not as significant as in the previous quinquennial survey rounds.

For instance, the ratio fell from 63.2 per cent to 59.4 per cent between 1993-04 and 1999-2000, and further to 55 per cent in 2004-05 for rural India. Similar — in fact, larger — reductions took place for urban households.

But in the latest 2009-10 survey round, the drop works out much lower — not even two percentage points — in rural and urban areas. That, in turn, may have to do with the way food prices have gone up in recent times, restraining families from spending on other things.

According to the survey, cereals still make up the largest chunk of an average Indian household's consumption budget: 15.6 per cent in rural and 9.1 per cent in urban areas.

This is followed by fuel and light (9.5 per cent in rural and 8 per cent in urban), milk and milk products (8.6 per cent and 7.8 per cent), vegetables (6.2 per cent and 4.3 per cent) and clothing (4.9 per cent and 4.7 per cent).

The survey has estimated the all-India average monthly per capita expenditure at Rs 1,053.64 in rural and Rs 1,984.46. The States among the top in spending are Kerala (Rs 1,835.22 in rural and Rs 2,412.58 in urban areas), Punjab (Rs 1,648.92 and Rs 2,108.79), Haryana (Rs 1,509.91 and Rs 2,321.49) and Maharashtra (Rs 1,152.79 and Rs 2,436.75).

The States at the bottom of the consumption chart are Bihar (Rs 780.15 and Rs 1,237.54), Chhattisgarh (Rs 783.57 and Rs 1,647.32), Orissa (Rs 818.47 and Rs 1,548.36) and Jharkhand (Rs 825.15 and Rs 1,583.75).

Published on July 08, 2011

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