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Household Consumption Expenditure Survey 2022–2023: Food spending shares decline in 11 years, although rural consumption spends increase more quickly than urban consumption does

<p>The Ministry of Statistics and Programme Implementation (MoSPI) released the most recent Household Consumption Expenditure Survey (HCES) 2022–23 on Saturday. It shows that the difference in average monthly per capita consumption expenditure (MPCE) between rural and urban households has decreased to 71.2% in 2022–23 from 83.9 percent in 2011–12.</p>
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<p>This implies that throughout the course of the 11-year period, expenditure on consumption in rural areas has increased more than that in urban areas.According to the survey data, there was a 164% growth in the average monthly consumer expenditure per person in rural areas from Rs 1,430 in 2011–12 to Rs 3,773 in 2022–2023. This is more than the 146% growth in the urban average monthly consumer spending per person from Rs 2,630 in 2011–12 to Rs 6,459 in 2022–2023 per person.</p>
<p>The government has not yet made public the survey findings from its 75th round, which covered the months of July 2017 through June 2018, despite the fact that the Household Consumption Expenditure surveys are conducted every five years. The results indicated a notable variance in both the levels and the direction of change in the consumption pattern. The leaked poll indicated a decrease in consumer spending.</p>
<p>According to the HCES factsheet, the average MPCE for the poorest 5% of rural population is Rs 1,373, and for the worst 5% of urban population, it is Rs 2,001. The average MPCE for the top 5% of people in both rural and urban areas is Rs 10,501 and Rs 20,824, respectively. Put otherwise, the MPCE of the top 5% of rural populations is 7.65 times higher than that of the lowest 5%, but the top 5% of urban populations has an MPCE that is more than ten times higher than that of the bottom 5%.</p>
<p>In India’s rural areas, food expenditures accounted for 46% (or Rs 1,750) of total expenditures in 2022–2023, whereas in urban areas, they made for 39% (or Rs 2,530). It was 42.62 percent in urban India and 52.90 percent in rural India in 2011–12. This affects inflation based on the consumer price index.</p>
<p>The increase in the percentage of expenditure on transportation, consumer services, and durable goods in 2022–2023 compared to 2011–12 was the primary driver of consumption expenditure on non-food items in both rural India (54%) and urban India (61%). During the same time period, the percentage of spending on grains, legumes, and vegetables decreased.</p>
<p>The government-distributed food grains and other free commodities provided under government initiatives were added to the survey results, which showed that the average monthly consumption expenditure in rural regions was Rs 3,860 and in urban areas was Rs 6,521. This suggests that, when compared to expenditures without the value of free things, such consumption expenditures are only higher by Rs 87 in rural regions and Rs 62 in urban areas.</p>
<p>The lowest 5% of rural India spends around Rs 1,441 (the imputed value of free things) compared to Rs 1,373 (the amount spent without the free items). This difference is quite slight. In the case of urban regions, the consumption spending of the lowest five percent was found to be Rs 2,001 in the absence of the imputed value of free products and Rs 2,087 in the presence of such things.</p>
<p>Data on household consumption of goods and services is gathered by the Household Consumption Expenditure Survey (HCES). The government canceled the 2017–18 survey due to leaked data that indicated a drop in consumption, therefore there has been a lengthy lapse of nearly a decade until the release of the fresh results of the consumer expenditure survey.</p>
<p>According to MoSPI’s report, it was agreed to carry out two surveys in a row in 2020–2021 and 2021–2022, in order to provide a suitable time frame for the revision of the macroeconomic indicators’ “base year.” Nevertheless, the 2020–21 survey could not begin owing to the Covid-19 epidemic. August 2022 marked the start of the first of the two surveys that would follow, and it lasted until July 2023. The Ministry said that it would soon provide a comprehensive report, since it has only published a factsheet for 2022–2023.</p>

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