Second Quarter Of Current FY Commences With Signs Of Accelerating Momentum In Indian Economy: RBI

The Reserve Bank of India has indicated that the second quarter of the current financial year has commenced with signs of accelerating momentum in the Indian economy. According to RBI’s monthly bulletin, improvements in the outlook for agriculture and the resurgence of rural spending have emerged as positive developments in demand conditions. 

The bulletin highlights that, based on the recent monthly per capita consumption expenditure survey by the NSSO, rural spending is outpacing urban segments, and there is a narrowing rural-urban divide. Factors such as increased wage rates under



schemes like MGNREGS and rising remittances to rural households due to urban migration are contributing significantly to the enhanced spending capacity of rural households, states the RBI bulletin. 

The consumption patterns revealed in the survey indicate that expenditures on conveyance, medical expenses, and consumer services now exceed those on cereals in rural areas. These trends are fostering optimism that rural India is narrowing the gap with its urban counterpart, potentially leading to convergence, as outlined in the report.