The Financial Express

June 12, 2011

S P O T L I G H T

Living

BLOOMBERG

InGuide to India The

Consumer India
NCAER-Centre For Macro Consumer Research kicks off the biggest ever consumer survey in IndiaNational Survey of Household Income and Expenditure 2011: Living in India
income, expenditure, ownership and savings patterns of the basic HE NATIONAL Council consumption unit in the country for Applied Economic a household. The composition of Research (NCAER), a the household itself has changed premier New Delhi- in terms of its size, social and relibased economic think- gious grouping, and profile of its tank, has been conducting members like age, sex, education, household-level income surveys work status, et al. It is here that since 1968. The only other nation- NCAERs new division, Centre For widepublishedsurveysthathavedi- Macro Consumer Researchs new rectly collected household income survey, National Survey of Housewas National Sample Survey Or- hold Income & Expenditure 2011: ganisation in 1960s, now discontin- Living in India, currently on, steps ued, and its one-off Situation in. With an initial sampling frame Assessment Survey of Farmers in of over 500,000 households across 2002-03. 30 states covering 268 districts, NCAER too added expenditure to 2,508 villages and 360 towns, Living its surveys only in mid 1980s, rough- in India went into final 100,000 ly coinciding with the beginning of sample households starting Indias economic rise and stupen- June 01, 2011. dous growth in its The Financial Exconsumer markets. press will bring its ANNUAL PER Thelastsuchsurreaders stories vey, National Sur- CAPITA INCOME based on data from vey of Household ALMOST DOUBLED LivinginIndiastartIncome & Expendi- FROM R23,198 IN ing later this year. ture (NSHIE) 2004-5 2004-05 TO R46,492 NSHIE 2011 will was conducted sevbring clarity to InIN 2010-11 en years ago. Much dias emerging inhas changed in the come pyramid, intervening period, from the vol- ownership patterns of over 38 canic growth between 2005 to 2008, household goods and services disthe global economic meltdown post sected every which wayrural, urLehman Brothers collapse in au- ban, et al. It will also bring glimpses tumn of 2008 that continued right of a humongous intra-country mitill beginning of 2010, to the reset of grant remittances, gold invest2010-11.Indiasannualpercapitain- ments, housing demand, household come almost doubled from R23,198 levelold-ageandsocialsecuritycovin 2004-05 to R46,492 in 2010-11. An- erage and much else. Whats more, nual per capita expenditure too gal- this time the survey is also capturloped, from R25,000 in 2007-08 to ing qualitative variables like conR30,000 in 2009-10. All manner of sumer perceptions, values, consumption grew, from food, con- aspirations, confidence and buying sumer expendables, cars, bikes, behaviour. Most marketers will tell fashion accessories to foreign trav- you that macro numbers apart, el. And for a change, rural growth what they look for is the granularity far outstripped that in cities thanks of dataatthehouseholdclusterlevel to growing farm and non-farm for actionable sales related proincomes and government largesse grammes. With Living in India, the in terms of loan waivers, most exhaustive and robust conguaranteed jobs and better support sumer survey to have been attemptpricesforcrops. edinthecountry,theyllneedtolook Surely, all that has changed the nofurther. feBureau

HOWWILL THE FUTURE UNFOLD

NCAER-CMCRprojectionsbasedonNSHIE2004-05 Increaseinaverage householdincome(2010-15)
(Rperannum)
2,19,000 74,825

Householdincome2015
3,50,000 2,50,000

1,23,000

1,56,000

1,60,000

24,276 2,159 2,120

Urban Rural Urban

2009-10

2015-16

2009-10

2015-16

2009-10

2015-16

RURAL

URBAN

ALL INDIA

Rural

Bottom20%

Top20%

Distributionofhouseholds
(million)
Annualhousehold income
(at2004-05prices)

Theaverageincreaseinhousehold incomewillbeaboutR60,000

Nodiscernablegain forbottom20%

2010-11 2015-16

Deprived Aspirers Middle Rich

BelowR112,000 R112,000-250,000 R250,000-1250,000 OverR1250,000

134.7 70.7 31.4 3.2

113.3 89.4 53.3 6.6

Distributionofincome:quintileanalysis
(%oftotalIncome)
2009-10 2014-15 12.6 19 53 9 8 6 6

(%oftotalruralincome)
NON-FARM FARM

Ruralincome

10.9 Q3

59

17

Q1 Q2 Bottom

Q4

Q5 Top

74

66

58 34 42 40

60

68

26

32

1970s

1980s

1993-94

2007-2008

2015-2016

Biggestgainer:Householdengagedinmodern services,highestincomeincrease(200%)

INTERVIEW: DR RAJESH SHUKLA

D I R E C T O R , N C A E R - C E N T R E F O R M A C R O C O N S U M E R R E S E A R C H

NSHIE2011also probesthemindof Indianconsumer

Dr Rajesh Shukla, director NCAER-CMCR, , isthemaninchargeof Indiasbiggest-everconsumer survey, the National Survey of Household Income and Expenditure (NSHIE 2011): LivinginIndia.HeshareswithFEthesurveys objectives, methodology, and how Living in Indiawillbeadatagoldmineforpolicymakers andmarketersalike.Excerpts: What are the objectives of NSHIE 2011? With household demand being one of the key pillars of the Indian economy, companies and policymakers require continuous dataontrendsinhouseholdspendingandincome. The NSHIE has for long been providing the nation reliable estimates of household income, whereas this has been a majorgapareaintherichtraditionof statisticaldatacollectioninIndia. Thekeypillarsof theNSHIEhavebeenthe robust estimation of the household troika income, spending and savings. NSHIE 2011 goes further, capturing the state of the nationdashboardwithdataoneducation,occupational transition, health, well-being, etc. Thistimethesurveyalsoincludesasectionon themindof theIndianconsumer,probingvalues, perceptions, aspirations, consumer confidenceandbuyingbehaviour. How was the survey research planned? Is itrobust? NSHIE2011wasplannedasaseriesof pan-India surveys, with ongoing panel surveys for fiveyears.Itwasstartedwiththepreliminary round canvassing five lakh households. The roundthatstartedonJune 01willbethemain survey round capturing comprehensive household data from a random sample of one lakh households drawn from the households canvassedintheprelimround.Thiswillbefollowed by a series of panel surveys for deeper issue-basedinvestigation,trackingandtrend mapping over the next five years. Twenty thousand households covered in the main survey will be selected for the panel round. What are the changes in NSHIE this time? ThegoalwastoconvertNSHIE2011intoapanelsurveyusingthecurrentsurveyasthebase for the next five years. Additionally the pre, sent one is being conducted in 32 states and

unionterritories.Thesamplingframe,which is used for stratification purposes as well as base data this time, comprises over 5,00,000 households. While the general structure of thequestionnaireinthemainroundhasbeen retainedfrom2004-05roundtoensurecomparability greater detail has been included in , many sections. The product categories itself have been vastly expanded, providing far greater insight into the buying behaviour of the Indian consumer. New themes such as health, remote payment, mindscape, etc have been added. Separate sections on household well being, orientation and buyer behaviour, too,havebeenadded. How will this benefit policy makers and corporates? Given the paucity of data and excessive reliance of policy makers and academicians on the NSS data, the NSHIE survey provides an alternativedatasetlikenoother.Forexample, poverty estimation in India can be informed with an alternative definition, and can be linkedtovariousoccupational,geographical, agro-climatic zones, educational and other characteristics,andpolicycanbeformulated in a more specific manner enhancing its outcome effectiveness, and even in helping programmes reaching the right beneficiaries. For corporates, the data provides them a unique opportunity to understand the Indianconsumerinamuchmoredetailed,more granular level and with much more comprehensivedataineachmicrosegment.Itis important to mention that the current study has been carried out only after consulting all stakeholders, who include members from both the corporate sector as well as policy makers.

SHYAM