Household consumption rises to a two-year high: report

According to an Economic Times report quoting data from Kantar Worldpanel, household consumption of groceries and home and personal care products during the April-June 2020 quarter increased substantially, hitting a two-year high.

August 11, 2020

The FMCG market expanded 4.3 per cent in volume and 8.5 per cent by value during the first quarter of FY 2020-22

While the demand for staples grew moderately, ready-to-eat and convenience foods saw exponential growth

India has announced a US$280 billion stimulus package to aid people hit by the pandemic and open up trade and investment

As a result of reforms, India is expected to perform better than major economies amid a global recession

While large parts of India were under a COVID-19 lockdown in the April-June 2020 quarter, household consumption of groceries and home and personal care products increased substantially, hitting a two-year high, according to an Economic Times report citing industry experts. The report quoted data from Kantar Worldpanel, which mentioned that the fast-moving consumer goods market expanded 4.3 per cent in volume and more than 8.5 per cent by value during the quarter.

A CNBC TV18 report citing the same report added that, while the demand for staples grew moderately, ready-to-eat and convenience food were the products that saw exponential growth. Thus, while edible oil grew 12 per cent and spices grew 10 per cent in India’s urban markets, biscuits and instant noodles saw 48 per cent and 36 per cent growth respectively. 

The global pandemic of the Coronavirus disease has brought forward a message and an opportunity for India. On May 12, Prime Minister Narendra Modi introduced India’s nearly Rs.21 trillion (US$280 billion) stimulus package to aid the people worst hit by the pandemic and open up new avenues of trade and investment in the post-Coronavirus economy. To enable the restarting of the economy with full vigour, the Government has introduced a set of new reforms and further liberalised access to certain sectors to make trade and investment in India even more lucrative. 

The measures will be of particular help as economics around the world try to shake off the impact of prolonged lockdowns and return to activities in a post-Coronavirus world. The reforms are built on five pillars – Economy, Infrastructure, System, Vibrant Demography and Demand – and provide enhanced access to at least eight sectors – Coal, Minerals, Defence, Civil Aviation, Electricity, Social Infrastructure, Space, and Atomic Energy. 

As a result of the initiatives, while the world slips into a recession due to the pandemic, India is expected to come out as an exception, as per the UNCTAD. Another report, by the UNESCAP, has pegged India’s growth at 4.8 per cent in 2020. Meanwhile, the World Bank expects India to grow by up to 2.8 per cent, and the IMF has projected India’s growth to be 1.9 per cent in 2020. The Government has been consulting all stakeholders to ensure a smooth return to normalcy.