IANS | 26 Feb, 2024
The results of the Household Consumption Expenditure Survey (HCES)
for 2022-23 demonstrates that rural livelihoods have seen an
improvement, especially for the lowest-income classes, as per an
analysis by Emkay Global Financial Services.
The difference between rural and urban Monthly Per Capita
Consumption Expenditure (MPCE) as a percentage of rural MPCE, declined
to 71 per cent in 2022-23 from 84 per cent in 2011-12 and more than 90
per cent in 2004-05. This is even more prominent when looking at
spending as per the fractile pyramid. The same ratio drops to just 46
per cent for the bottom five per cent of the pyramid and stays under 50
per cent for the bottom 20 per cent.
“Thus, the poorest rural
households have been able to spend at a much closer level to their urban
counterparts, and this implies that the government's policy initiatives
for enhancing rural incomes have worked to an extent," the report said.
On
the other hand, a difference of over 85 per cent for the highest 10 per
cent of households implies rising income inequality at the top of the
pyramid.
The results of the HCES for 2022-23 show that rural
households have experienced improvement at a higher rate than urban ones
since the last survey (2011-12).
The difference between rural and
urban MPCE has narrowed substantially over the years, implying
successful government policies for improving rural incomes, while this
is even more pronounced at the lower levels of the pyramid.
Conversely,
the gap is bigger at the top, reflecting an increase in inequality at
higher income levels. Encouragingly, the share of food expenditure is
lower across sections, while spending on proteins has improved, with
rural even higher than urban, the report added.
A time-series
analysis shows that the share of food in MPCE has been declining for
both urban and rural households, reflecting shifting preferences as
incomes rise. It also indicates more aspirational behaviour, with the
share of fruits, milk, consumer services, durable goods and
entertainment rising as well, again for both urban and rural households,
the report said.
It is also encouraging that the share of
proteins (milk, pulses, meat, fish and eggs) in total spending on food
has risen across both sections. Rural households are spending more on
proteins than urban households as a share of their food expenses. Both
urban and rural households have been able to spend more of their food
budgets on better nutrition, despite spending less on food overall,
which is extremely important given India remains a protein-deficient
country.
