Ahmedabad, May 2:
Due to high food
inflation, middle and lower income groups (MIGs and LIGs) in India
The survey, conducted
in March-April in the four metros and some other cities, suggested that the
average monthly expenditure has increased from Rs 2,000 to Rs 6,000 and
expenditure on food, as a percentage of monthly household expenditure, has gone
up from 40 per cent to 100 per cent.
Consumption of
individual food items show a significant reduction as well, particularly in
case of rice, wheat, yellow daal, onion, tomato, butter, milk ,sugar and fruits
and vegetables, and the number of households consuming milk at least twice a
day has also reduced.
The growing food
budget has forced households to cut costs in other areas such as healthcare and
transportation. Over 75 per cent of the surveyed households now go to
government hospitals or doctors instead of private doctors or hospitals. Seventy
eight per cent have decreased spending on eating out, 65 per cent on clothing
and 77 per cent on vacations.
Similarly, 49 per cent
have decreased their spend on home appliances, 44 per cent on home and personal
electronics, 42 per cent on automobiles; and 35 per cent on real estate.
Those belonging to the
MIG have curtailed expenses on such heads by nearly 65 per cent during the last
6 months due to rise in inflation, interest rates and fuel costs. With food and
education of children eating up most of their incomes, the saving is likely to
come down heavily, reveals the survey done on 200 employees selected from each
city as samples. The Delhiites topped in curtailing their expenses followed by
Mumbai, Ahmedabad, Chandigarh, Kolkata, Chennai and Dehradun, said Mr D S
Rawat, Secretary-General, Assocham.
The survey reveals
that food inflation impacted the most consumers in metros and other major
cities vis-à-vis tier-III and semi-urban areas due to sudden hike in the
fruits, vegetables and milk prices and that the rise in inflation and per
capita income was disproportionate.
Consumers' growing
unease is reflected in their saving rate and spending habits, with many in MIGs
and LIGs indicating that they are finding ways to cut back spending now or will
do so. Around 69 per cent of the respondents have cut down in their saving
rate.
Nearly half of MIG
members either avoid shopping altogether or shop only for absolute necessities;
76 per cent said that their shopping has been restricted to only necessities and
splurge in their spending is occasional.
About 88 per cent of
the respondents said they have cut back on everyday expenses and save money by
avoiding outside food, car-pooling, cutting down on gas and use of electricity.
The urban male's
expenses of Rs 500-Rs 2,000 per month on drinks, cigarettes, gutkha, pan, etc
has come down by 20 per cent while the urban women have also cut down monthly
expenses on cosmetics, beauty treatments etc from Rs 1,500-2,000 to Rs
500-1,000.
Over 87 per cent said
their monthly grocery bills have jumped from Rs 3,000 to about Rs 7,000/ to
8,000 in the last two years.
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