Economy is growing, but that isn't translating to well-being, Pg10

Key Highlights:

• India's economic growth is not adequately translating into improved well-being for a large section of the population.
• Consumption growth has slowed since 2011-12, with the Household Consumption Expenditure Survey 2023-24 indicating significant food deprivation.
• Approximately 30% of the all-India population consumes less than two Rs 30 thali meals daily, reflecting high food deprivation.
• Unemployment rates, including youth unemployment, remained higher in 2025 compared to 2011-12, despite economic growth.
• Rising food prices have led to declining real wages and growing inequality, impacting household budgets and consumption of non-food items.
• The article suggests focusing on increasing agricultural yield to stabilize food prices rather than solely pursuing "more reforms" or attracting Foreign Direct Investment (FDI).

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Detailed Insights:

• Deliberations at the Prime Minister’s Economic Advisory Council (PMEAC) have focused on sustaining growth and advancing "ease of living," but the article highlights a disconnect with actual well-being.
• National Sample Survey (NSS) household expenditure surveys consistently show a deceleration in consumption growth post-2011-12.
• Data from the UN’s Food and Agricultural Organisation (FAO) indicates that a significant portion of India's population, estimated at 50%, cannot afford a healthy diet.
• The increase in the real price of food by over 30% since 2011-12 is identified as a primary driver of declining real wages and reduced overall consumption.
• While Ease of Doing Business reforms address supply-side issues for non-agricultural activities, the current economic challenge is a demand shortage, exacerbated by high food prices.
• The article argues that rising profits, often accompanying declining real wages, tend to favor capital-intensive goods, which have a limited impact on employment generation.

Key Concepts Involved:

• Real Wages: Wages adjusted for inflation, reflecting the actual purchasing power of earnings.
• Food Deprivation: A state where individuals lack consistent access to sufficient, safe, and nutritious food for an active and healthy life.
• Ease of Living: A measure of the quality of life experienced by citizens, encompassing various economic, social, and environmental factors.
• Foreign Direct Investment (FDI): An investment made by a firm or individual in one country into business interests located in another country, establishing lasting interest and managerial influence.
• Ease of Doing Business: The relative simplicity, cost, and time required to start, operate, and wind up a business within an economy's regulatory environment.
• Prime Minister’s Economic Advisory Council (PMEAC): An independent body constituted to advise the Government of India, specifically the Prime Minister, on economic and related issues.
• Household Consumption Expenditure Survey (HCES): A survey conducted by the National Sample Survey Office (NSSO) to collect data on household spending patterns, used to assess economic well-being and update economic indicators.