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Resource centre on India's rural distress
 
 

NSS data shows improvement in living standard of the poorest-Surabhi

-The Indian Express

The National Sample Survey has found a 17 per cent improvement in expenditure patterns of the poorest decile of India’s urban population in two years till 2011-12.

“The poorest 10 per cent of India’s rural population had an average monthly per capita expenditure (MPCE) of Rs 503.49 per month,” the survey found. In the last round of the NSS for 2009-10, the poorest 10 per cent of the rural population had an average MPCE of Rs 453, while the poorest 10 per cent of the urban population had an average MPCE of Rs 599.

The NSS survey is a critical input for a host of government and private sector companies to decide on everything from anti-poverty programmes to sales of consumer goods.

The 68th round of the NSS, whose provisional findings were released on Wednesday, covered household consumer expenditure during 2011-12. It was based on a sample of 59,070 households in 7,391 villages and 41,602 households in 5,223 urban blocks. The final report is likely to be released next year.

The poorest 10 per cent lives on Rs 23.40 per day while their rural counterparts make do with even less at Rs 16.78.

The rate of growth of expenditure is lower in rural areas as the rural poor are known to depend more on non-traded items.

But when it came to all income groups, the average monthly consumption expenditure increased by 18 per cent in rural areas against 13.2 per cent in urban areas, said Sunil Sinha, director and principal economist Crisil.

The NSS survey has pegged this average monthly spending by rural families in 2011-12 at Rs 1,281.45 and by urban households at Rs 2,401.68. “The per capita expenditure level of the urban population was on the average about 87.4 per cent higher than that of the rural population,” it said.

Sinha said that there had been an improvement in the monthly per capita consumption expenditure as purchasing power had grown due to higher incomes since Indians traditionally don’t borrow to finance spending.

“The important thing to note is that consumption expenditure in rural areas is increasing and is on more and more diversified and manufactured items,” Sinha added.

As expected, the difference between the richest 10 per cent of the population and the poorest 10 per cent was sharper in urban areas. While the richest 10 per cent of the rural population had an average MPCE of Rs 3,459.77, about 6.9 times that of the poorest 10 per cent, the ratio rose to 10.9 times in the metros.

Data findings

* The poorest 10% lives on Rs 23.40 per day while their rural counterparts make do with Rs 16.78

* The rate of growth of expenditure is lower in rural areas as the rural poor are known to depend more on non-traded items

* The average monthly consumption expenditure increased by 18% in rural areas against 13.2% in urban areas