India's Food Consumption Sees Historic Shift: Less Than Half of Household Spending

A recent paper by the Economic Advisory Council to the Prime Minister reveals that, for the first time since independence, India's household spending on food has fallen to under half of total expenditure. The shift indicates changing consumption patterns and the impact of governmental food security policies. Significant regional variations in consumption growth were observed, especially in rural areas.

India's average household spending on food has, for the first time since 1947, fallen to less than half, according to a recent report by the Economic Advisory Council to the Prime Minister (EAC-PM).

The report, titled 'Changes in India's Food Consumption and Policy Implications: A Comprehensive Analysis of Household Consumption Expenditure Survey 2022-23 and 2011-12,' reveals a significant shift in India's food consumption patterns.

The share of total household expenditure on food has seen a marked decline across rural and urban areas throughout the country. This trend is especially significant as it's the first occurrence since India's independence and is seen as a marker of economic progress.

The analysis draws from the Household Consumption Expenditure Survey of 2022-23, comparing it to data from 2011-12. It notes a substantial increase in the average monthly per capita expenditure in both rural and urban India, with notable variations across different states.

For example, rural areas in West Bengal, Tamil Nadu, and Sikkim have seen consumption expenditure growths of 151%, 214%, and 394% respectively. Overall, rural households experienced a 164% growth, outpacing the 146% growth seen in urban households.

The report also highlights a decline in spending on cereals, particularly among the bottom 20% of households in rural and urban areas. This suggests the effectiveness of governmental food security policies that prioritize free food grains for the most vulnerable populations.

The findings suggest that agricultural policies need to evolve beyond cereal production, and that support measures like Minimum Support Price (MSP) for cereals may have limited effects on farmers' welfare.

Moreover, there has been a universal rise in spending on processed and packaged foods, particularly among the top 20% of households and in urban areas. The report warns that this trend could have adverse health implications, necessitating further research and potential regulatory policies to ensure nutritional quality.

(With inputs from agencies.)