73% consumers expect reduction in prices of essential items in Budget 2023: Survey

The latest findings of the India Consumer Sentiment Index (CSI), a monthly analysis of consumer perception on a wide range of issues, highlighted that one of the major requests which come out in this survey is the reduction in income tax rates, which will give consumers more money in hand.

The Pre-Budget net CSI score, calculated by percentage increase minus percentage decrease in sentiment, is at +10, from +08 last month reflecting an increase by 02 points.

The sentiment analysis delves into five relevant sub-indices – Overall household spending, spending on essential and non-essential items, spending on healthcare, media consumption habits, entertainment and tourism trends.

The survey was carried out via Computer-Aided Telephonic Interviews with a sample size of 6100 people across 27 states and UTs.

Sixty-five percent belonged to rural India, while 35% belonged to urban counterparts. In terms of regional spread, 23% belong to the Northern parts while 27% belong to the Eastern parts of India.

Moreover, 28% and 22% belonged to Western and Southern parts of India respectively.

A total of 69% of the respondents were male, while 31% were female. In terms of the two majority sample groups, 33% reflect the age group 36YO to 50YO and 30% reflect the age group of 26YO to 35YO.

Commenting on the CSI report, Pradeep Gupta, Chairman & MD, Axis My India, said “Consumers are looking forward to the upcoming budget announcements as a ray of hope for better life and livelihood and there is a huge expectation in terms of price control."

Consumers are also looking forward to various measures that the government will take towards fuelling digitization in the Indian economy, he said, addding that overall, despite global headwinds, the Indian economy should be poised for further growth in 2023.

On topics of current national interest ahead of the 2023 budget:

·Deep diving deeper to understand citizens’ sentiments towards the Indian economy, the survey found out that 22% consider ‘oil prices’ to significantly impact the Indian economy this year.

Moreover, 16% each consider ‘inflation’ and ‘upcoming 2024 elections’ to also have a bearing this year on the economy. Government policies and Russia-Ukraine war continue to be a concern for 14% and 11% respectively.

The CSI survey also attempted to demystify consumer expectations from the budget. It revealed top issues that the upcoming budget needs to address:

-   A majority of 73% feels that the budget needs to address ‘reduction in prices of essential items like soap, detergent, cooking oil’.

-   54% believe that it should also look into GST exemption on essential items

-   44% wants reduction in GST % &

-   32% wants housing loan exemption limits to be re-looked at

· The survey also highlighted that 26% believe that Finance Minister should lower personal income tax rates in the upcoming budget by 5%. In addition, 25% wants the exemption limit to be raised beyond 2.5 lacs.

· The survey also threw light on factors that will help digitization in the Indian economy. Better banking network (view of 32%), better spread of telecom connectivity & 5G (view of 19%) and better Internet security (view of 18%) are considered important pillars of digitization.

· According to Axis My India’s Survey 38% notice brand advertisements on TV while 32% notice ads on digital medium. In addition of those surveyed 51% have noticed advertisements atleast once (or more) on digital medium.

Key CSI findings:

· Overall household spending has increased for 59% of families, increased by 4% compared to last month. The net score, which was +47, last month has increased by 5 to +52 this month.

· Spends on essentials like personal care & household items have increased for 40% of families, which reflects a dip by 1% from last month. The net score, which was at +26 last month, increased by two at +28 this month.

· Spends on non-essential & discretionary products like AC, Car, and Refrigerator has increased for 5% of families, which reflects a decrease by 2% from last month. The net score, which was at +2 last month, has reduced to +1 this month. Sentiment towards discretionary spends highlight the lowest percentage increase in the last four months.

· Expenses towards health-related items such as vitamins, tests, healthy food has surged for 33% of the families.

This reflects a decrease in consumption by 6% from last month.

The health score which has a negative connotation i.e., the lesser the spends on health items the better the sentiments, had a net score value of -28 last month, is at -22 this month. Sentiment towards health spends also showcase the lowest percentage increase in the last four months.

· Consumption of media (TV, Internet, Radio etc.) has increased for 20% of the families, which reflects a decrease by 1% from last four months where it has been consistent at 21%. The overall, net score, which was at -2 last month, reflects 0 this month.

· Mobility has increased for 9% of the families, which reflects an increase by 2% from last month. The overall mobility net indicator score, which was at +2 last month, has remained the same this month.