Indians spending less on food, more on discretionary items -government survey

MUMBAI, Feb 25: Indians are spending less on food, particularly staples like rice and wheat, and more on discretionary items such as processed food, as well as durables like televisions and fridges, government consumption data showed.

The Household Consumption Expenditure Survey, released late on Saturday, estimates average rural consumer spending rose to 3,773 rupees ($45.54) a month per person for the 12 months through July from 1,430 rupees in the previous survey in 2011-2012, while urban spending rose to 6,459 rupees ($77.95) from 2,630 rupees.

Prime Minister Narendra Modi's government did not release a 2017-2018 survey due to what it called "data quality issues". The decision prompted controversy over whether the administration was concealing economic data.

The government denied suggestions it was withholding the data because they showed weak consumption trends.

The new survey will form the basis of a review of India's consumer price inflation index.

Reuters Graphics

Spending on food fell to 46% of monthly consumption for rural consumers from nearly 53% in 2011-12, while in urban areas it fell to 39% from 43%.

Indians are spending less on cereals, including wheat and rice, and pulses, but more on beverages, refreshments and processed food.

Among non-food items, consumers are spending more on conveyance, consumer services and durable goods, like televisions and fridges.

Reuters Graphics

The results come before India goes to the polls in an election to be held by May, with Modi seeking a rare third term.

While the Indian economy is forecast to grow at a world-beating 7.3% in the fiscal year that started in April and 7% next fiscal year, large parts of the population living in rural areas face stagnant incomes and high inflation.