Consumption inequality down in a decade

New Delhi: Consumption inequality declined over the last decade, with the share of the top 10% households in consumption falling 1.9% in rural areas and 4% in urban areas, showed results of the Household Consumption Expenditure Survey (HCES) released on Friday.

The share of all other categories rose during the period, the results released by the government indicated, with the maximum jump coming from the middle income households.

Data released by the government found that the Gini coefficient - a measure of inequality - declined between 2011-12 and 2022-23.


"Comparison of the Gini coefficient from HCES: 2022-23 to those from 2011-12 shows a decline, from 0.283 to 0.266 for the rural sector and from 0.363 to 0.314 for the urban sector," the report said.

The survey report found that while the share of consumption has remained the same for the poorest households in rural areas - at 1.8% between 2011-12 and 2022-23 - it went up to 1.5% in urban areas from 1.3% earlier.

Meanwhile, the share of middle 40-70% of households went up by 0.9 percentage point during the period in rural areas and 1.4 percentage points for urban spaces. The share of the top 10% still remains high at 22.7% in rural areas, whereas it is 25.7% in urban areas.

The richest 5% of rural households spend ₹10,501 per month on consumption, whereas the lowest 5% earn ₹1,373 on average. The inequality is much higher in urban areas, with richest urban households (top 5%) earning 10.5 times more, at ₹20,824, than poorest 5% households.

Declining cereal consumption
The monthly per capita cereal consumption has declined to 1.6 kg for rural and 1.3 kg for urban households in a decade, detailed results of the survey showed.

Per capita cereal consumption in rural households was down to 9.61 kg in 2022-23 from 11.23 kg in 2011-12. Urban households consumed even less at 8.05 kg in 2022-23 compared with 9.32 earlier.

The decline in consumption follows a shift in spending from food to non-food items and a rise in share of processed food in the basket.

As cereal consumption share more than halved in rural areas to 4.89% from 10.69% over a decade ago, the share of processed food and beverages went up to 9.62% from 7.9% earlier.