Ministry of Statistics & Programme Implementation

Household Consumption Expenditure Survey:

2023-24

Sustained momentum in rural consumption continues as

urban-rural gap

narrows down further in 2023-24 from the level of 2022-23

Posted On: 27 DEC 2024 4:00PM by PIB Delhi

Introduction

The Ministry of Statistics and Programme Implementation (MoSPI) decided to

conduct two consecutive surveys on household consumption expenditure during
2022-23 and 2023-24, once situation normalized after the Covid-19 pandemic. The
first survey was conducted during the period August 2022 to July 2023 and the
summary results of the survey in the form of a factsheet was released in February
2024. Subsequently, the detailed report and the unit level data of the survey was
released in June 2024.
The fieldwork of the second survey on the subject has been undertaken during
August 2023 to July 2024 throughout the entire country. The summary results of the
Household Consumption Expenditure Survey: 2023-24 (HCES:2023-24) has been
prepared at state and broad item groups level and is being released in the form of a
factsheet. The factsheet of HCES:2023-24 is available in the website of the Ministry (h
ttps://www.mospi.gov.in).
HCES is designed to collect information on consumption and expenditure of the
households on goods and services. The survey provides data required to assess trends
in economic well-being and to determine and update the basket of consumer goods
and services and weights used for the calculation of the Consumer Price Index. Data
collected in HCES is also used to measure poverty, inequality, and social exclusion.
The Monthly Per Capita Consumption Expenditure (MPCE) compiled from HCES is the
primary indicator used for most analytical purposes.
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. As in
HCES:2022-23, in HCES:2023-24 also two sets of estimates of MPCE have been
 generated: (i) without considering imputed values of items received free of cost
by the households through various social welfare programmes and (ii)
considering imputed values of items received free of cost by the households
through various social welfare programmes. The first set of estimates are
presented in Section A while the second ones are presented in Section B[i].

Important Findings of HCES: 2023-24

The average MPCE in rural and urban India in 2023-24 has been estimated to be
Rs. 4,122 and Rs. 6,996, respectively without taking into account of the values of
items received free of cost by the households through various social welfare
programmes.
Considering the imputed values of items received free of cost through various
social welfare programmes, these estimates become Rs. 4,247 and Rs. 7,078
respectively, for rural and urban areas.
In nominal prices, the average MPCE (without imputation) in 2023-24 increases
by about 9% in rural areas and 8% in urban areas from the level of 2022-23.
The urban-rural gap in MPCE has declined to 71% in 2022-23 from 84% in 2011-
12. It has further come down to 70% in 2023-24 that confirms sustained
momentum of consumption growth in rural areas.
When ranked by MPCE, the increase in the average MPCE in 2023-24 from the
level of 2022-23 has been the maximum for the bottom 5 to 10 % of India’s
population, for both rural and urban 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% and 60% share in MPCE in rural and urban areas respectively.
Beverages, refreshments and processed food continues 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% share is another major constituent of the urban households’ non-
food expenditure.
Consumption inequality, both in rural and urban areas has declined from the
level of 2022-23. The Gini coefficient has declined to 0.237 in 2023-24 from 0.266
in 2022-23 for rural areas and to 0.284 in 2023-24 from 0.314 in 2022-23 for
urban areas.

A. Estimates of MPCE (without considering imputed values of items received

free of cost through various social welfare programmes in HCES:2023-24)

The values of average MPCE for HCES:2023-24, HCES:2022-23 (for both without
considering the imputed values of the items received free of cost through social
transfer) and NSS 68th (2011-12) rounds at all-India level at current prices and at
2011-12 prices are given in Table 1 below:

Table 1: Average MPCE (Rs.) at current Prices and 2011-12 prices

Survey Period at current Prices at 2011-12 Prices

Rural Urban Rural Urban

4,122 6,996
HCES: 2023-24 Aug 2023- Jul 2024 2,079 3,632

HCES: 2022-23 Aug 2022- Jul 2023 3,773 6,459 2,008 3,510

68th round (2011-12) Jul 2011-Jun 2012 1,430 2,630 1,430 2,630

Variation in MPCE across fractiles classes

Besides, the all-India average MPCE, average MPCE over fractile classes of MPCE
compiled from the data collected in HCES: 2023-24 at current prices are shown below
in Figure 1. For any fraction f (0<f<1), the corresponding fractile of the distribution of
MPCE (Y) is the level of MPCE, say, Yf such that the proportion of population whose
household MPCE lies below Yf is f.

The bottom 5% of India’s rural population, ranked by MPCE, has an average MPCE of
Rs. 1,677 while it is Rs. 2,376 for the same category of population in the urban areas.

The top 5% of India’s rural and urban population, ranked by MPCE, has an average
MPCE of Rs. 10,137 and Rs. 20,310, respectively.

Average MPCE in 2023-24 has increased the most (22%) from the level of 2022-23 for
the bottom 5% of India’s rural population when ranked by MPCE and for the
corresponding segment of urban population the growth has been about 19% during
the same period.

Figure 1: Average MPCE value for different fractile classes of MPCE

Variation in MPCE among the States and Union Territories

Among the 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 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 the states is the highest in
Meghalaya (104%) followed by Jharkhand (83%) and Chhattisgarh (80%).

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

The relative position of major states in terms of MPCE with regard to all-India MPCE
is shown in Figures 2 & 3.
Consumption Behavior of the Indian Households

Across all the States and UTs, the households are observed to spend more on non-
food items with share of non-food items in average MPCE being 53% and 60% in
rural and urban areas, respectively. The major contributors in the non-food
expenditure of the households in 2023-24 have been: (i) Conveyance, (ii) clothing,
bedding & footwear, (iii) miscellaneous goods & entertainment and (iv) durable
goods durable goods. Rent with a share of around 7% is another major constituent
of households’ non-food expenditure in urban India.

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. A comparison of contribution of different item categories
in the total consumption expenditure of the households in rural and urban areas for
2022-23 and 2023-24 is shown in Figures 4, 5, 6 and 7.
B. Estimates
of MPCE (considering imputed values of items received free of
cost through various social welfare programmes in HCES: 2023-24@)
The values of average MPCE for HCES:2023-24, HCES:2022-23 (for both considering
imputed values of items received free of cost through social transfer) and NSS 68th
(2011-12) rounds at all-India level at current prices and at 2011-12 prices are given
in Table 2 below:

Table 2: Average MPCE with imputation (Rs.) at current Prices and 2011-12 prices

Survey Period at current Prices at 2011-12 Prices

Rural Urban Rural Urban

HCES: 2023-24 Aug 2023- Jul 4,247 7,078 2,142 3,674

2024

HCES: 2022-23 Aug 2022- Jul 3,860 6,521 2,054 3,544

2023

68th round (2011- Jul 2011-Jun 2012 1,430 2,630 1,430 2,630
12)

Variation in MPCE among the States and Union Territories

Among the States, MPCE (considering imputed values of items received free of cost
through various social welfare programmes) is the highest in Sikkim (Rural – Rs.
9,474 and Urban – Rs. 13,965) and it is the lowest in Chhattisgarh (Rural – Rs. 2,927
and Urban – Rs. 5,114).

Among the 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.
4,450) and Jammu and Kashmir (Rs. 6,375) in rural and urban areas, respectively.
The relative position of major states in terms of MPCE with regard to all-India MPCE
is shown in Figures 8 & 9.
[i] @ In HCES:2023-24, the usual practice of imputation of the value figures for
consumption out of (i) home-grown/home-produced stock and (ii) gifts, loans, free
collection and goods received in exchange of goods and services etc. has been
continued; and accordingly, estimates of MPCE have been generated. These are
presented in section A.

A provision for collection of information on the quantity of consumption for a

number of items, received and consumed by the households free of cost through
various social welfare programmes has been made in HCES:2022-23 and continued
in HCES:2023-24. Consequently, the value figures for (i) food items: Rice, Wheat/Atta,
Jowar, Bajra, Maize, Ragi, Barley, Small Millets, Pulses, Gram, Salt, Sugar, Edible Oil
and (ii) non-food items: Laptop/PC, Tablet, Mobile Handset, Bicycle, Motor
Cycle/Scooty, Clothing (school uniform), Footwear (school shoe etc.) received free of
cost by the households through these programmes, have been imputed using an
appropriate method. Accordingly, another set of estimates of MPCE considering
 imputed values of these items and of consumption out of home produce, free
collection, gifts, loans etc. has also been compiled for HCES: 2023-24. These estimates
are presented in Section B.

Pradhan Mantri Jan Aarogya Yojna (PM-JAY) or any other similar state specific
schemes provide cashless access to health care services to the beneficiaries at the
point of service delivery, i.e., the hospital and the beneficiary does not have any
information on the cost of the services availed. For such schemes, entire premium is
borne by the Government and the beneficiary makes no contribution. Since HCES is
not a record-based survey, often it is not possible to ascertain the exact ailment or
disease for which the benefit has been availed. Hence, in view of the complexity and
appropriateness involved in imputation of the expenditure for such services, no
attempt has been made to impute the expenditure of health services availed by the
households free of cost.

For similar reasons, the expenditure for free education services (i.e.,
reimbursement/waiver of school or college fees) has also not been imputed.

*****

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