The effect of inflation is not limited only to rising prices in the market, rather its direct impact is visible on the household budget every month. As soon as the salary arrives at the beginning of the month, the family has to set aside money for essential needs like ration, household expenses, transportation, children's education and health. Among these expenses, it is interesting to see on which needs Indian families are spending the largest part of their total consumption amount.
The data on private final consumption expenditure in the National Accounts Statistics 2026 of the Ministry of Statistics and Program Implementation (MoSPI) reveals a picture of the spending of the people in the country. According to the data, in 2024-25, Indian households spent a total of Rs 18,132,452 crore, or about Rs 181.32 lakh crore, on daily needs and other things in the domestic market.
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Where are Indian families spending the most money?
Out of the total expenditure of Indian households, most of the money is spent on food and non-alcoholic beverages. Rs 42.41 lakh crore was spent on this in 2022-23. It increased to Rs 47.27 lakh crore in 2023-24 and Rs 52.88 lakh crore in 2024-25. This means that in two years the expenditure related to food has increased by Rs 10.47 lakh crore, which is about 24.7%.
Transport has now become the second largest expenditure of Indian households. In 2022-23, people had spent Rs 26.13 lakh crore on transport. This expenditure will increase to Rs 28.82 lakh crore in 2023-24 and Rs 31.34 lakh crore in 2024-25. That means the expenditure on transport increased by about 19.9% in two years.
At the same time, expenditure on housing, water, electricity, gas and other fuels has also increased. Rs 26.90 lakh crore was spent on this in 2022-23, which increased to Rs 28.91 lakh crore in 2023-24 and Rs 30.70 lakh crore in 2024-25. However, the pace of increase in this expenditure was less than that of transport. It increased by 7.5% in 2023-24 and by 6.2% in 2024-25.
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Sharp jump in expenditure on education and household goods
People's expenditure on some things increased much faster than normal. Expenditure on furnishings, household goods and maintenance was Rs 6.03 lakh crore in 2022-23, increasing to Rs 8.35 lakh crore in 2023-24. That means there was an increase of about 38.5% in just one year. In 2024-25, this expenditure increased to Rs 8.95 lakh crore, although this time the pace of increase reduced to 7.2%.
People's expenditure on education also increased continuously. The expenditure on education in 2022-23 is Rs 5.20 lakh crore, which will increase to Rs 6.38 lakh crore in 2023-24 and Rs 7.03 lakh crore in 2024-25. That means expenditure on education increased by about 35.2% in two years. There was an increase of 22.7% in 2023-24, while in 2024-25 it increased to 10.2%.
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Sharp increase in expenditure on treatment and insurance in 2024-25
Expenditure on health was Rs 8.09 lakh crore in 2022-23, which increased marginally to Rs 8.40 lakh crore in 2023-24. It will increase rapidly to Rs 9.55 lakh crore in 2024-25. There was an increase of about 13.7% in one year. Similarly, expenditure on insurance and financial services increased from Rs 10.16 lakh crore to Rs 10.93 lakh crore and then to Rs 12.27 lakh crore. The growth of this item in 2024-25 was about 12.3%.
Some expenses first decreased, then increased in 2024-25
Expenditures have not increased consistently in every sector. People had spent Rs 5.26 lakh crore in 2022-23 on personal care, social security and other services. This amount decreased to Rs 4.58 lakh crore in 2023-24 but increased again to Rs 5.63 lakh crore in 2024-25. Similarly, expenditure on liquor, tobacco and intoxicants was Rs 2.44 lakh crore in 2022-23, which came down to Rs 2.25 lakh crore in 2023-24. However, it increases to Rs 2.82 lakh crore in 2024-25.
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People's expenditure on entertainment, sports and culture was also Rs 1.46 lakh crore in 2022-23, which decreased to Rs 1.38 lakh crore in 2023-24. After this it increased to Rs 1.54 lakh crore in 2024-25.