With increasing
purchasing power and aspiration for a better life in the villages, Karnataka,
Andhra Pradesh, Kerala, Rajasthan, Tamil Nadu and Gujarat have registered a
phenomenal growth in ‘rural’ consumption of consumer durable goods and
surprisingly the overall trend in rural areas during the period of 2007-08 and
2011-12 was higher than the cities, according to the study brought out by
ASSOCHAM.
The top five states
which registered phenomenal growth rate of durable goods rural consumption
expenditure were Karnataka (59.5 %), Andhra Pradesh (44.3%), Rajasthan (40.7%),
Kerala (40.4%) and Gujarat (37.0%) during the period.
As per the CSO data,
most of the states witnessed a double digit growth in consumer durables goods
expenditure and much higher than all India during the 2007-08 to 2011-12.
The other states
which have recorded robust growth rate of rural consumption expenditure on
consumer durable goods were Tamil Nadu ( 33.3 per cent), Madhya Pradesh (27.2
per cent), Maharashtra (25.2 per cent), Bihar (25.0 per cent), Haryana (23.9
per cent) and Punjab (f 22.7 per cent), reveals the ASSOCHAM paper.
Odisha, however,
registered nominal growth in consumer durable goods consumption expenditure,
adds the paper.
The all India rural
consumption expenditure on consumer durable goods grew at a compound annual
growth rate of 16.5 percent during 2007-08 to 2011-12 whereas urban consumption
expenditure on this head increased 15.6 percent per annum.
The states which have
registered lower than all India rural consumption expenditure growth were West
Bengal (15.7 per cent), Uttar Pradesh (14.6 per cent), Assam (13.3 per cent)
and Odisha (1.4 per cent).
“The study further
suggests as the income level of rural people increases, consumption expenditure
on consumer durable also goes up reflecting aspirations for a better life in
the countryside. There also appears to be
a positive nexus between consumer durable goods consumption expenditure and
availability of basic infrastructure in rural areas such as, electricity etc.
In fact, adequate availability of electricity is the key”, ASSOCHAM spokesman
said.
If we compare the
consumption expenditure on consumer durable goods during 2004-05 to 2007-08, it
indicates different scenario. The consumer durable goods rural consumption
expenditure was lower than urban consumption expenditure during the same
period. The consumer durable goods rural consumption expenditure growth rate
was 11.4 percent and urban consumption expenditure growth rate was 11.8 per
cent during the same period
However, under the
impact of economic slowdown, in the recent past, consumer durable goods index
of industrial production (IIP) has witnessed a sharp deceleration. “But once
the overall industrial output is revived, the rural India would again lead the
growth of consumer goods”, the study says.
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