Rural, urban consumption inequality dips during Aug 2023-July 2024: Govt

Consumption inequality in rural as well as urban areas declined during August 2023-July 2024 period as compared to a year ago, according to the latest Household Consumption Expenditure Survey released on Friday.

The Gini coefficient declined to 0.237 from 0.266 for rural areas and to 0.284 from 0.314 for urban areas during the period under review, a statement by Ministry of Statistics & Programme Implementation on the survey said.

The Gini coefficient statistically measures consumption inequality and wealth distribution within a society.

The "consumption inequality, both in rural and urban areas has declined from the level of 2022-23," stated the Household Consumption Expenditure Survey (HCES) based on the fieldwork undertaken during August 2023 to July 2024.

 

The average MPCE (monthly per capital expenditure) in rural and urban India in 2023-24, without taking into account the social welfare schemes, has been estimated at Rs 4,122 and Rs 6,996 (at current prices), respectively.

According to the survey, the MPCE was Rs 3,773 in rural areas and Rs 6,459 in urban areas (at current prices) in 2022-23.

The estimates of MPCE of 2023-24 are based on the data collected from 2,61,953 households (1,54,357 in rural areas and 1,07,596 in urban areas) in the central sample spread over all states and Union Territories in the country.

Considering the imputed values of items received free of cost through various social welfare programmes, these estimates of MPCE become Rs 4,247 and Rs 7,078 respectively, for rural and urban areas (2023-2024).

In nominal prices, the average MPCE (without imputation) in 2023-24 increased by about 9 per cent in rural areas and 8 per cent in urban areas from the level of 2022-23.

The urban-rural gap in MPCE declined to 71 per cent in 2022-23 from 84 per cent in 2011-12.

It has further come down to 70 per cent in 2023-24 that confirms sustained momentum of consumption growth in rural areas.

Consistent with the trend observed in HCES:2022-23, non-food items remain the major contributor to the household's average monthly expenditure in 2023-24 with about 53 per cent and 60 per cent share in MPCE in rural and urban areas, respectively.

Beverages, refreshments and processed food continue to have the major expenditure share in 2023-24 in the food items basket of the rural and urban households.

Conveyance, clothing, bedding & footwear, miscellaneous goods & entertainment and durable goods have major expenditure share in non-food expenditure of the households in both rural and urban areas.

Rent consisting of house rent, garage rent and hotel accommodation charges with about 7 per cent share is another major constituent of the urban households' non-food expenditure.

Among states, MPCE is the highest in Sikkim (rural Rs 9,377 and urban Rs 13,927) and it is the lowest in Chhattisgarh (rural Rs 2,739 and urban Rs 4,927).

Among the union territories (UTs), MPCE is the highest in Chandigarh (rural Rs 8,857 and urban Rs 13,425), whereas it is the lowest in Dadra and Nagar Haveli and Daman and Diu (Rs 4,311) and Jammu and Kashmir (Rs 6,327) in rural and urban areas, respectively.

The rural-urban difference in average MPCE among states is the highest in Meghalaya (104 per cent) followed by Jharkhand (83 per cent) and Chhattisgarh (80 per cent).

Average MPCE in 9 out of 18 major states is higher than the all-India average MPCE in both rural and urban areas.

Across all states and UTs, households spent more on non-food items with share of non-food items in average MPCE being 53 per cent and 60 per cent in rural and urban areas, respectively, the survey showed.

The major contributors in the non-food expenditure of the households in 2023-24 have been conveyance, clothing, bedding & footwear, miscellaneous goods & entertainment and durable goods.

Rent with a share of around 7 per cent is another major constituent of households' non-food expenditure in urban India, it stated.

As in 2022-23, beverages and processed food continues to be the major contributor in total consumption expenditure of food items in 2023-24, followed by milk & milk products and vegetables, it stated.