India’s rural consumption is showing sustained growth, leading to a shrinking gap between urban and rural expenditure, according to the latest Household Consumption Survey released by the Ministry of Statistics.

The survey highlights that the urban-rural gap in monthly per capita consumption expenditure (MPCE) decreased further in 2023-24. In 2011-12, this gap stood at 84% but fell to 71% in 2022-23 and further narrowed to 70% in 2023-24.

The average MPCE for rural areas in 2023-24 is estimated at ₹4,122, while urban areas reported ₹6,996. These figures exclude the value of goods received free of cost under social welfare schemes. When accounting for these benefits, the MPCE rises to ₹4,247 for rural areas and ₹7,078 for urban households.

In nominal terms, the survey notes a 9% increase in rural MPCE and an 8% rise in urban MPCE compared to 2022-23. The largest growth in MPCE was observed among the bottom 5-10% of the population in both rural and urban areas, signaling a trend toward more equitable economic growth.

Non-food items continued to dominate household spending, contributing 53% of MPCE in rural areas and 60% in urban regions. Key components of non-food expenditure included transportation, clothing, durable goods, and entertainment.

Within food expenditure, beverages, refreshments, and processed foods maintained the highest share in both rural and urban households. For urban households, rent—including housing, garage, and hotel charges—constituted 7% of non-food spending.

The Gini coefficient, a measure of income inequality, showed a decline in both rural and urban areas. For rural regions, the coefficient dropped from 0.266 in 2022-23 to 0.237 in 2023-24. Similarly, in urban areas, it fell from 0.314 to 0.284 during the same period, reflecting reduced consumption disparity.

The survey, conducted between August 2023 and July 2024, collected data from 2,61,953 households nationwide, including 1,54,357 rural and 1,07,596 urban households.

(IANS)