Rural monthly per capita expenditure rising faster than urban: MoSPI

The average Monthly Per Capita Consumption Expenditure (MPCE) in rural India is rising faster than it is in urban India during 2023-24, the latest MoSPI consumption survey reveals. The MPCE in rural areas has risen by 9% to ₹4,122 in 2023-24 from ₹3,773 in 2022-23, while the expenditure in urban areas has risen by 8% to ₹6,996 from ₹6,459 in 2022-23. These values exclude the imputed value of free items from social welfare programs.

The survey highlights that the rural-urban consumption expenditure gap continues to shrink, with the MPCE gap narrowing to 70% in 2023-24, compared to 84% in 2011-12.

The increase is driven by higher non-food expenses, which now constitute the largest share of household spending, almost 53% in rural areas and 60% in urban areas. Some of the key non-food expenditures include conveyance, clothing, entertainment, durable goods, and rent, which accounts for 7% of urban households' expenses.

When calculated with the imputed values of freebies, MPCE rises to ₹4,247 in rural areas and ₹7,078 in urban areas.

The Ministry of Statistics and Programme Implementation (MoSPI) conducted consecutive household consumption surveys in 2022-23 and 2023-24 after the Covid-19 pandemic. The second survey's fieldwork spanned August 2023 to July 2024 across India. The Household Consumption and Expenditure Survey (HCES) gathers data on household spending across goods and services.

The survey reveals the monthly per capita consumption expenditure (MPCE) incurred by households in rural and urban areas across different states and UTs of the countries.

The survey tracks economic well-being trends, updates the Consumer Price Index (CPI) basket and weights, and informs measures of poverty, inequality, and social exclusion.

The estimates of MPCE of 2023-24 are based on the data collected from 2.61 lakh households (1.54 lakh in rural and 1.07 lakh in urban areas) across the country.

Across states and UTs, Sikkim recorded the highest monthly expenditure with rural MPCE at ₹9,377 and urban at ₹13,927 and Chhattisgarh has the lowest expenditure as rural MPCE stood at ₹2,739 and urban at ₹4,927. Quite interestingly, Delhi NCR was not the UT with the highest MPCE, as Chandigarh in rural areas saw a MPCE of ₹8,857 and in urban areas a MPCE of ₹13,425.

The survey reveals that Meghalaya has the largest rural-urban MPCE gap (104%), followed by Jharkhand (83%) and Chhattisgarh (80%). Nine of 18 major states surpass the all-India average MPCE in both rural and urban areas.