New Delhi: Food consumption is a key barometer of consumer demand in the modern economy. If the people are buying and consuming, the factories will keep producing and trade will thrive, ensuring economic activity. According to the Rural Barometer report by GroupM and Kantar, India’s rural economy has shown encouraging signs of growth with its FMCG basket reporting an average 60 per cent rise over the past 2 years.
This was seen in the expansion of the average FMCG basket to 9.3 in 2024 from 5.88 in 2022 led by a rise in demand for beverages and ready to eat (RTE) goods. While Maharashtra reported 41 per cent growth during this period, Jammu and Kashmir exhibited 39 per cent growth and Odisha clocked 26 per cent growth during the period under consideration, according to the report. While overall growth has been 60 per cent, these states, among others, have been outliers, according to the report.
What is driving rural FMCG basket growth
The rural FMCG basket is led by the diversity of rural income, according tio the report. Individuals with diverse incomes (81 per cent) are expanding their choice of brands. Individuals whose income depends solely on agriculture (19 per cent), however, display less diversity in their food choices, said Puneet Avasthi, director of specialist businesses and insights division at Kantar.
The Rural Barometer Report compiles data from 20 states with a sample size of 4,376 adults from rural India. It displays a rise in purchasing power with a preference for convenience products. Media consumption has also risen towards hybrid formats with 42 per cent of active Internet users in rural India and 23 per cent e-commerce users, according to the report.
Rural consumption growth outpaces urban demand
According to the NielsenIQ FMCG Quarterly snapshot, India’s FMCG sector growth jumped by 5.7 per cent in value terms, 4.1 per cent in volume terms and 1.5 per cent in price terms. Rural consumption growth rose to 6 per cent from 5.2 per cent quarter on quarter compared to 2.8 per cent growth in the urban sector.
India’s rural food basket expanded by 60 per cent in the past 3 years, according to research by GroupM-Kantar. Here’s what it means Economy Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
