Trunk Economics | August 16, 2024Paneer on the platter:
Rising incomes fuel diet shift from humble cereal to protein-rich choices
WHAT’S FOR LUNCH TODAY? It’s a common question for millions of Indian households, where, in many families, something special is rustled up on a Sunday, a day when usually all in the family enjoy a meal together.
The footfalls at the neighbourhood souks, the fishmongers and meat and poultry sellers, are predominantly high during the weekends as the sound of haggling bargain hunters meld in with the cacophony of buzzing bazaars, all choreographed by the forces of demand and supply!
The food collective in the household platter and how it has changed over the years can be an interesting way to gauge and map India’s progress.
Here’s an instructive piece of statistics. The government’s household consumption and expenditure survey ( HCES 2022-23) data show that consumption of protein-rich food items such as pulses, milk, eggs and fish have risen faster than food staples such as cereals.
In 1999-2000, rural households, on an average, spent 22 percent of total consumption spending on cereals such as rice and wheat. This was disproportionately high, leaving little for spending on buying protein-rich items. This has dramatically come down to 4.91 percent. Urban households once spent 12 percent on cereals in 1999-2000. This has come down to 3.94 percent in 2022-23.
Income and diet axiomatically tied
There is something fundamental at play here, mirroring the axiomatic relationship between income levels and food consumption pattern. At lower levels of income, a family will use up most of its earnings in buying food, essential for survival, leaving them with little else to spend on non-food requirements such as clothes, consumer durables, and education among others.
This tends to reverse as income levels rise. The share of spending on food in their consumption expenditure goes down progressively as incomes rise, a phenomenon that is commonly described as Engel's law after 19th century statistician Ernst Engel who propounded this correlation in a structured form.
The nuance is more in the nature of the food basket. When incomes rise, within the spending on food, the expenditure on nutritious food (protein and vitamins) such as livestock products (milk and meat), fish, fruits, and vegetables go up.
This is known as Bennett’s Law, named after MK. Bennett, who showed that as incomes rise, people eat fewer calorie-dense starchy staple foods and more nutrient-dense meats, oils, sweeteners, fruits etc.
This, however, does not imply that food becomes less important when incomes rise. Far from it. The spending on food items remains inelastic beyond a point as one can spend and consume only so much on food.
The nuance is more in the nature of the food basket. When incomes rise, within the spending on food, the expenditure on nutritious food (protein and vitamins) such as livestock products (milk and meat), fish, fruits, and vegetables go up. This is known as Bennett’s Law, named after MK. Bennett, who showed that as incomes rise, people eat fewer calorie-dense starchy staple foods and more nutrient-dense meats, oils, sweeteners, fruits etc.
The data appear to reinforce this hypothesis. Sample this. In 1999-2000 rural households spent, on an average, 11.21 per cent of their total consumption spending on protein-rich items. The corresponding figure for urban households was 10.68 percent. This is significantly gone up for rural households in 2022-23 to 14 percent and 11.17 percent for urban households.
Macro
This is showing up in the macro-economic numbers, too. The contribution of livestock to the total GVA or gross value added (at constant prices) in agriculture and allied sectors increased from 24.32 per cent in 2014-15 to 30.38 per cent in 2022-23. (GVA is GDP minus taxes, and, therefore, is a more realistic proxy to track consumption and income).
Paneer, one of the most popular high-protein vegetarian foods, is more commonplace now than two decades ago.
As an aside, in 2014-15 India produced 146.3 million tonnes of milk. In 2022-23 it stands at 230.6 million tonnes. The number of egg production has gone up from 78,484 million in 2014-15 to 1,38,376 million in 2022-23, nearly doubling in nine years. Fish production, likewise, has vaulted from 10,762 thousand tonnes in 2014-15 to 17,545 thousand tonnes in 2022-23, up more than 70 per cent.
This, perhaps, explains why paneer, one of the most popular high-protein vegetarian foods, is more commonplace now than two decades ago.
As an aside, in 2014-15 India produced 146.3 million tonnes of milk. In 2022-23 it stands at 230.6 million tonnes. The number of egg production has gone up from 78,484 million in 2014-15 to 1,38,376 million in 2022-23, nearly doubling in nine years. Fish production, likewise, has vaulted from 10,762 thousand tonnes in 2014-15 to 17,545 thousand tonnes in 2022-23, up more than 70 per cent. This, perhaps, explains why paneer, one of the most popular high-protein vegetarian foods, is more commonplace now than two decades ago.
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