Rising expenses


Domestic households’ expenditure of their total income on health, education, transport and communication has substantially improved in the past six years, while spending on food, clothing and tobacco significantly reduced in the same period, says a study.

The findings indicate that, as of March31, 2006, expenses in majority of the cases on health care, education, transport and communications of domestic households had shot up from the 1999-2000 levels. However, the study on ‘Emerging patterns of private final consumption expenditure’ found that the expenditure on food, clothing and intoxicants has come down from the same period.

The rising income levels coupled with increased awakening have led to more spending by households on healthcare, education and transport and communication. This reflects the improvement in living standards, particularly the middle class revealed a study by Assocham.

Expenditure on Alcohol Down!

Domestic households roughly spent nearly 1% of their monthly budget of their total earnings on tobacco, pan and consumption of other intoxicants in 1999-2000, whereas their expenses on such items have come by more than half and is estimated at 0.48% in 2005-06.

Transport and communications are other areas of significance. Households chose to spend 12.97% of their earnings towards transport and commutations in 1999-2000. But their expenditure doubled in 2005-06.

The share of communication has gone up mainly due to greater and easy availability of services by private players including cellular phones in urban and rural areas. While rising oil prices led to more spending on commuting, the study added.

Power Consumption up too

With improved living standards and easy availability of electrical gadgets, power consumption of households has risen significantly, the analysis said. It pointed out that increased power and fuel consumption is also a sign of growing income.

The cost of electricity has gone up too, along with greater consumption o-f electrical goods. While the share of expenditure on refrigerators, air conditioners has also gone up, the cost of using these appliances has increased because there are more people using these goods, which entail higher power bills. “Indian society is evolving and shifting its consumption pattern to comforts, luxuries and better services rather than sticking to necessities� the study stated.

Power consumption and expenditure on education, transport has risen; but money spent on intoxicants has halved!