Poverty in India is in low single digit, close to or below 5%: NITI Aayog CEO

Household consumption survey: The poverty in India is in the low digits, closer to or lower than 5 per cent, B. V. R. Subrahmanyam, CEO of the NITI Aayog said on Sunday, a day after the release of the findings of much-awaited household consumption expenditure survey by the Ministry of Statistics and Programme Implementation.

"The big picture of the survey is that consumption in both rural and urban India has witnessed a sharp rise from 2011-2012," Subrahmanyam said. Quantitatively, the rise is 2.5 times of the consumption level witnessed in 2011-2012, he added further.

He also highlighted that the rise in consumption shows that the growth is not restricted and is broad-based.  According to him, the survey has shown that the existing rural-urban divide is diminishing.
"Which is a positive thing," Subrahmanyam said.

What does the consumption survey show?

After a hiatus of 11 years, the Household Consumption Expenditure Survey's results were out on February 24. The Ministry of Statistics and Programme Implementation showed on Saturday that the average monthly per capita consumption expenditure is up by 33.5 per cent since 2011-2012 to Rs 3,773 in 2022-2023, witnessing an increase of 164 per cent.

This is higher than the 146 per cent increase in urban average monthly consumption expenditure per person to Rs 6,459 in 2022-23, as compared to Rs 2,630 per person in 2011-12.

Similarly, the household consumption expenditure survey in rural India showed that the monthly consumption expenditure rose by 40.42 per cent to Rs 2,008.

The proportion of spending on food has also dipped to 46.4 per cent for rural household from 52.9 per cent to 46.4 per cent. 

Also, the proportion of expenditure on food in urban India has also declined from 42.6 per cent to 39.2 per cent.

Talking about states, Sikkim witnessed the highest monthly per capita consumption at Rs 7,731, and lowest in Chhattisgarh at Rs 2,466.

Why it is important?

Household Per Capital Expenditure Survey released on Saturday holds a significant importance as this survey is a fundamental premise in making some key policy decisions - be it for determining poverty in the nation, or determining the new consumer price index series as HCES is the key in giving weightages to food and non-food items in inflation basket.

The latest HCES showed that the proportion of spending on food has dipped both in rural and urban India, which simply means that people can spend on other things such as footwear, entertainment, etc.