Avg household spending on food in India falls below 50% of monthly expenses, first time since independence: Report
Recent data indicates that the expenditure on cereals has decreased considerably among households, with the most significant reductions observed in the bottom 20% income bracket in both rural and urban settings
- Sep 6, 2024,
- Updated Sep 6, 2024 1:47 PM IST
In a remarkable shift in the spending by Indian households, the share of total household expenditure on food has seen a substantial decline across both rural and urban areas in India, marking a significant milestone in modern Indian history.
For the first time since independence, average household spending on food has fallen to less than half of overall monthly expenditures, signalling notable progress in the country’s economic landscape, according to a report by the Economic Advisory Council to the Prime Minister (EAC-PM).
Recent data indicates that the expenditure on cereals has decreased considerably among households, with the most significant reductions observed in the bottom 20% income bracket in both rural and urban settings.
This trend likely reflects the Indian government's effective food security policies, which provide free food grains to millions of beneficiaries, particularly targeting the most vulnerable populations.
The changing dynamics of household expenditure on food affect agriculture and health and nutrition policies in India. As consumer demand shifts and supply factors improve, experts suggest that the government should continue to support agricultural policies that enhance the production and accessibility of a diverse range of food items, including fruits, vegetables, and animal-source foods.
The report states, "Agriculture policies will have to be tailored beyond cereals, whose consumption is declining across all wealth classes of society. At the same time, support policies like MSP, which overwhelmingly targets cereal procurement, will have a limited impact on the welfare of farmers."
The alterations in household expenditure patterns reflect both changing consumer preferences and significant improvements in supply chains, including better infrastructure, storage, and transportation. These advancements have broadened market access for perishable items such as fresh fruits, dairy products, eggs, fish, and meat, making them more accessible and affordable throughout the country.
Moreover, there has been a notable increase in the share of household expenditure on served and packaged processed foods, a trend observed across various income classes but particularly pronounced among the top 20% of households and in urban areas.
On the other hand, the report states that the significant decline in the share of cereals in household expenditure has allowed households to diversify their diets, with increased spending on milk & milk products, fresh fruits, and eggs, fish & meat.
In a remarkable shift in the spending by Indian households, the share of total household expenditure on food has seen a substantial decline across both rural and urban areas in India, marking a significant milestone in modern Indian history.
For the first time since independence, average household spending on food has fallen to less than half of overall monthly expenditures, signalling notable progress in the country’s economic landscape, according to a report by the Economic Advisory Council to the Prime Minister (EAC-PM).
Recent data indicates that the expenditure on cereals has decreased considerably among households, with the most significant reductions observed in the bottom 20% income bracket in both rural and urban settings.
This trend likely reflects the Indian government's effective food security policies, which provide free food grains to millions of beneficiaries, particularly targeting the most vulnerable populations.
The changing dynamics of household expenditure on food affect agriculture and health and nutrition policies in India. As consumer demand shifts and supply factors improve, experts suggest that the government should continue to support agricultural policies that enhance the production and accessibility of a diverse range of food items, including fruits, vegetables, and animal-source foods.
The report states, "Agriculture policies will have to be tailored beyond cereals, whose consumption is declining across all wealth classes of society. At the same time, support policies like MSP, which overwhelmingly targets cereal procurement, will have a limited impact on the welfare of farmers."
The alterations in household expenditure patterns reflect both changing consumer preferences and significant improvements in supply chains, including better infrastructure, storage, and transportation. These advancements have broadened market access for perishable items such as fresh fruits, dairy products, eggs, fish, and meat, making them more accessible and affordable throughout the country.
Moreover, there has been a notable increase in the share of household expenditure on served and packaged processed foods, a trend observed across various income classes but particularly pronounced among the top 20% of households and in urban areas.
On the other hand, the report states that the significant decline in the share of cereals in household expenditure has allowed households to diversify their diets, with increased spending on milk & milk products, fresh fruits, and eggs, fish & meat.