As hundreds of millions of people shift to higher standards of living, the focus is changing from basic needs of nutrition such as rice and coarse grains to more aspirational products such as protein-rich eggs, meat and fish.
The latest household consumption and expenditure survey ( HCES 2022-23) data shows that consumption of protein-rich food items such as pulses, milk, eggs and fish have risen faster than food staples such as cereals.
In 1999-2000, rural households, on an average spent, 22 per cent of total consumption spending on cereals such as rice and wheat. This was disproportionately high, leaving little for spending on buying protein-rich items such. This has dramatically come down to 4.91 per cent.
Urban households used to spend 12 per cent on cereals in 1999-200. This has come down to 3.94 per cent in 2022-23.
Economists say low-level incomes go with carbohydrate-rich diets based on cereals. That is changing. Rise in income has increased the share of proteins in peoples' diets. Rising affluence has also led to an increase in demand for proteins and nutrition.
The HCES 2022-23 data appear to reinforce this hypothesis. Sample this. In 1999-2000 rural households spent, on an average, 11.21 per cent of their total consumption spending on protein-rich items. The corresponding figure for urban households was 10.68 per cent.
This is significantly gone up for rural households in 2022-23 to 14 per cent and 11.17 per cent for urban households.
In 2010 former RBI Deputy Governor Subir Gokarn had concluded that proteins gain importance after per-capita incomes cross Rs 580-690 per month in rural areas and Rs 1,100-1,380 in urban areas.
That seems to be playing out now.
People’s higher spending on nutritional items in their diet is also a reasonable proxy to measure rising rural incomes driven by greater economic opportunities, buttressing the premise people tend to proportionately spend more on fortifying their platter with nutrition and proteins, bolstered by surplus money to spend besides cereals.
This sustaining demand in an economy may be the primary factor driving what experts describe as "structural inflation."
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