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As per the “Key Indicators: Household Consumer Expenditure in India” survey conducted by the National Statistical Office (NSO), the average monthly spending by an individual fell to Rs 1,446 in 2017-18 from Rs 1,501 in 2011-12, down 3.7 per cent.
Here is a data comparison to put this slip in perspective: In 2011-12, monthly per capita consumption expenditure had gone up by a sizeable 13 per cent over a two-year span.
It is worth mentioning here that these figures are in real terms, which means they have been adjusted for inflation with 2009-10 as the base.
The survey in question was carried out during the period between July 2017 and June 2018. It found that spending in rural India went down by 8.8 per cent for the period, while the corresponding fall for urban India stood at 2 per cent over a 6-year span.
India scrapes by
The survey found that rural Indians bought less of all food products barring milk and milk-related items. Worryingly, consumers from all parts of the country — including urban areas — spent drastically less on essential food items such as oil, salt, sugar and spices, the article highlighted.
Non-food spending threw up mixed data. In rural areas, spending on such items fell by 7.6 per cent during the survey period, while urban spending on the same went up by 3.8 per cent.
Rural India’s monthly spending on food in 2017-18 was Rs 580, a near 10 per cent decline from Rs 643 in 2011-12. In urban areas, the corresponding numbers rose, but only barely — from Rs 943 in the previous survey to Rs 946 in the latest one.
According to former Planning Commission member Abhijit Sen, the real worry is in the area of welfare. “A fall in food spending, especially in villages, shows that malnutrition has increased. It would be fair to say that poverty must have increased significantly,” he said.
When did this consumption fall exactly begin? Sen thinks answering this question would be difficult, given the 6-year gap between the two surveys. “Most probably, it started in 2012-13 because till then rural wages were going up. A fall in consumption can also mean that when there was a slowdown in the farm sector, there were not enough jobs in the non-farm sector,” BS quoted the renowned economist as saying.
Cold feet over hot potato
The most disconcerting bit to economists was the fall in food consumption for the first time in decades. Many said it implied aggravating malnutrition levels.
A JNU economist said that there was never a time in at least in the last 50 years when real-term consumption expenditure fell. The last time such a fall occurred was way back in 1972-73, he told the paper.
These findings could stoke further fears about the state of the economy as a fraught GDP season approaches — most analysts see Q2 GDP growth plummeting to around 4%.
The report had purportedly been okayed for release by a high-level panel several months ago. The yearly report of the Ministry of Statistics and Programme Implementation (MoSPI) reveals that the report in question was slated for release in June 2019. But the release was held back because of the “adverse findings” it contained, BS quoted unnamed sources as saying.
The original survey had been passed by an NSO-constituted working group. According to four sources quoted by the newspaper, the government developed cold feet over the adverse findings and subsequently, a sub-committee was tasked with vetting the same. The committee confirmed the original findings — that the survey had no defect — the sources said.
If these sources are proved accurate, this would be second time in quick succession that a survey with uncomfortable findings has been withheld. The PLFS survey that underlined a 45-year jobs low had also been held back for five months even after getting the nod from the Statistical Commission.
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