Bharat is consuming more, and how! In 2011, 9.1 crore rural households used banking services compared to 5.3 crore in urban India. At 9.3 crore, more homes in rural India had electricity than in urban regions (7.3 crore). Of course, the number of rural households at 16.8 crore dwarfed the number of urban ones (7.9 crore).

Thanks to the increase in welfare spending by the Government, the income of rural consumers has risen, and improved their lifestyle.

Consumer companies take note: Rural India markets may still be the place to go if shopping for higher market share.

Growing faster

According to the the data in Census 2011, in the last decade, rural India has also seen the market for several consumer goods grow faster than those in urban India.

The households owning a scooter/motor cycle rose by 161 per cent in rural India compared with an increase of 110 per cent in urban India.

Probably due to more electricity connections, the number of homes owning a television set has jumped by 114 per cent in rural areas, while the growth was only 75 per cent in the cities.

Similarly, helped by the mushrooming mobile phone industry, the number of households with a telephone has expanded 17 times in rural regions in a 10-year span compared to a five-fold expansion in urban regions.

One interesting twist to the statistics is that fewer urban homes have LPG cylinders (5.1 crore) when compared to television sets (6.5 crore). In rural regions, 5.6 crore households owned a television but only 1.91 crore had an LPG connection. This highlights the opportunity to expand for the gas distribution companies.

Penetration still low

Though rural consumers have been trading up and purchasing products that were never on their shopping lists, the proportion of homes owning these is still low.

For instance, even after an 85 per cent jump the number of households having mosaic/tile floors, only 3.6 per cent of the rural homes have such flooring. Though there has been a 144 per cent jump in the number of households having LPG connection in rural India, it is only 11.4 per cent of the total households.

Migration

Overall, the Census data show that India still lives in the villages with 68 per cent households living in rural India versus 32 per cent in the cities.

However, in the last 10 years, the number of urban households has increased sharply, by 47 per cent, versus 21per cent for rural India. This suggests that more people may have migrated from villages to towns.

Related Topics