Financial inner world of India's households

In 2007, a McKinsey report predicted that Indian consumption will quadruple by 2025 due to rising household income spurred by strong economic growth, India’s youthful demographic profile and a decline in the savings rate. This would make India the world’s fifth-largest consumer market, profoundly impacting both the manner in which businesses and policy-makers address the new “middle class” as well as the nature of savings in the subcontinent. Given the contraction in demand from traditional export markets abroad, domestic consumption trends in countries like India and China have become more relevant than ever before.

In that sense, How India Earns, Spends and Saves – Unmasking the Real India is well timed. Based on the results of the National Survey of Household Income and Expenditure (NSHIE) of 2004-05, conducted every five years, the book looks to unravel the complicated landscape of the Indian consumer.

 Divided into seven chapters, the book analyses the earning, spending and saving patterns of Indian households, and discusses income distributions and disparities, specifically dissecting the well-being of urban and rural consumers. Based on a survey that spans 440,000 households spread over 24 states, it is an exhaustive look into the financial inner world of Indian households.

Although the book offers little new material in the manner of analysis, the value-add is in the detail of the data it provides. Given the rising importance of the domestic market, it is crucial for businesses and policy-makers to understand emerging trends in earning, spending and saving.

Full review here Business Standard