India's Rural Consumption Narrows Urban Gap

On 30th December, 2024, the Ministry of Statistics released the latest Household Consumption Survey, highlighting sustained rural consumption growth and a shrinking rural-urban expenditure gap.

Key Points

Rural-Urban Gap Reduces: The urban-rural gap in monthly per capita consumption expenditure (MPCE) dropped to 70% in 2023-24, compared to 71% in 2022-23 and 84% in 2011-12.
Rural MPCE Growth: Rural MPCE reached ₹4,122 in 2023-24, with social welfare benefits raising it to ₹4,247; urban MPCE stood at ₹6,996 and ₹7,078 respectively.
Equitable Growth: Rural MPCE saw a 9% nominal increase, surpassing the 8% rise in urban MPCE, with the highest growth in the bottom 5-10% of the population.
Spending Priorities: Non-food items accounted for 53% of rural MPCE and 60% of urban MPCE, dominated by transport, clothing, durable goods, and entertainment.
Food Expenditure Trends: Beverages, refreshments, and processed foods remained the largest components of food spending for both rural and urban households.
Income Inequality Drops: The Gini coefficient declined from 0.266 to 0.237 in rural areas and from 0.314 to 0.284 in urban areas, indicating reduced consumption disparity.
Comprehensive Survey: Data was collected from 2,61,953 households, including 1,54,357 rural and 1,07,596 urban households, between August 2023 and July 2024.