Indians spend less on food, more on tobacco

The expenditure and consumption patterns of both rural and urban households are almost similar, with one exception.
Image used for representational purpose only.
Image used for representational purpose only.

NEW DELHI: The monthly expenditure and consumption patterns of Indian households are changing, shows the latest report of the National Statistical Organisation (NSO). While there is a reduction in expenditure on food items and education, the spending on medical expenses, conveyance, rent and unhealthy items such as pan, tobacco, intoxicants has seen a rise.

The expenditure and consumption patterns of both rural and urban households are almost similar, with one exception. The trend of spending on egg, fish and meat in urban households has fallen compared to rural households, where it has marginally increased.

The government is yet to release the detailed report, Household Consumption Expenditure Survey, which was conducted during August 2022 to July 2023. Such a survey is being released after almost a decade.

It is worth mentioning that the government had earlier junked the 2017-18 report of NSO, citing lack of “data quality”, although critics say it was binned due to the “adverse findings”. The earlier report had shown that household spending had declined for the first time in the last four decades.

The latest NSO report shows that both rural and urban India has reduced its expenditure on food consumption and increased expenditure on non-food items in the last one decade. In 2011, urban India used to spend 42.6% of its monthly expenditure on food, which reduced to 39%. In rural India, the expenditure on food was reduced from 52.8% to 46.38%.

The consumption of cereals reduced drastically, along with pulses, vegetables, edible oils, salt and sugar. There is a similar decline in expenditure on education, fuels and light, clothing and footwear.

Experts say expenditure on cereals has reduced owing to government welfare schemes.

“The Union government, as well as many state governments, provides free cereals under different schemes such as PMGKY, which prompt consumers to spend less on it,” said PC Mohanan, India’s former chief statistician. He further said that in urban areas, people started buying food from outside and this could also be a reason for spending less on cereals and pulses.

Inflation has impacted consumption patterns as well. “The high prices of pulses, vegetables and edible oils in the past few years have impacted consumers all across the country,” said a senior official at the Department of Consumer Affairs. The government has been taking various measures to control prices in the last few years.

“Spending less on fuel and light is also due to the Ujjwala scheme and solar schemes providing cheap energy sources,” said Mohanan.

However, industry experts are clueless about why people have started spending less on non-food items such as education, clothing and footwear.

The report also points to increasing consumption of unhealthy items such as pan, tobacco and other intoxicants. The medical expenses as well as expenditure on rent and conveyance have also increased. Spending on milk and milk-related products have seen a marginal spike.

The report also underlined increasing rural and urban divide in expenditure patterns. Gujarat tops the list among states where rural monthly expenditures are way behind the urban. In Kerala and Punjab, the divide is negligible.

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The New Indian Express