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Economy leads to better life

The per capita income of an Indian has increased from Rs 16,133 to Rs 20,734 when at constant (1990-2000) prices, reports Chetan Chauhan.

india Updated: Jan 31, 2007 21:56 IST

The booming economy has given a reason for an average Indian to cheer ---- their saving and spending power both has improved dramatically --- thanks to annual per capita incomes rising by over Rs 4,000 in five years, a trend never seen before.

The per capita income of an Indian has increased from Rs 16,133 to Rs 20,734 when at constant (1990-2000) prices. And, the biggest jump has been recorded in the year 2005-06 when the incomes rose by 7.4, highest figure recorded so far.

The Central Statistical Organisation report released on Wednesday summarises the growth of the Indian economy and agriculture since 2000 and its impact on a citizen.

Economy grew by nine per cent in 2005-06 and agriculture by 6 per cent during the period. Planning Commission Deputy Chairperson Montek Singh Aluwalia termed the report as a 'positive' indication for country's economy but expressed concern over poor agricultural growth.

"The average agricultural growth is about 2.4 per cent substantially lower than the target of four per cent," he said.

Highlighting tremendous increase in spending power of Indians, the report also provided an insight into the changing expenditure habits of an average India.

Since 2000, spending of Indians on health, beverages and intoxicants, transport and communication and education has almost doubled. More citizens now prefer eating out than before with restaurant industry growing an average annual rate of 15-17 per cent, the report states.

The report indicates that average Indian has become more health conscious as spending on medical care jumped from Rs 61,199 in 2000 to Rs 1.12 lakh in 2005-06.

Also, expenditure on sugar, potato, oil products, tobacco and its products saw a decline, despite prices rising of these products.

The only aberration in India was witnessed in spending beverages and intoxicants (read liquor), which jumped from Rs 21,000 to close to Rs 50,000 between 2000 and 2006.

Higher incomes have resulted in a higher saving for a family. Domestic savings has increased from Rs 9,73,028 crores in 2004-05 to Rs 11,56,809 in 2005-06.

Indians are saving more than financial savings, including investments, rather than putting money in physical assets, the report states.

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First Published: Jan 31, 2007 21:56 IST