Indian Consumers Spend More On Health And Education, Shift Away From Essentials Over A Decade: National Account Statistics 2024

Over the past decade, Indian consumers have increasingly prioritised spending on services such as health and education over traditional essentials like food, clothing, and housing.

According to the National Account Statistics 2024, the share of essentials in private final consumption expenditure (PFCE) declined between FY13 and FY23, while sectors like health and education saw significant growth.

Health expenditures grew by 8.2 per cent annually, and education spending rose by 7.5 per cent outpacing the overall PFCE growth rate of 6 per cent. Other service categories, such as transport and communication, also witnessed robust growth at 8.2 per cent and 7.8 per cent respectively.

In contrast, spending on housing dropped from 16.4 per cent of PFCE in FY13 to 13 per cent in FY23, while clothing expenses fell from 6.1 per cent to 4.8 per cent. Despite the decline, essentials like food and beverages remain the largest spending category, accounting for 28.2 per cent of PFCE in FY23, down from 30.5 per cent in FY13.

The top five spending areas in FY23 were food (27.8 per cent), transport services (9.3 per cent), housing rentals (9.2 per cent), personal transport operations (6.8 per cent), and bread and cereals (6.3 per cent).

The data reflects a broader trend of increased consumer focus on services. This shift is attributed to growing aspirations, urbanisation, and improved access to education and healthcare facilities.

"The rise in health and education expenditure highlights the evolving priorities of Indian households as they invest more in improving their quality of life," experts noted.