Rural Household Income Expectations
According to a survey conducted by the National Bank for Agriculture and Rural Development (Nabard) in May 2025, 74% of rural households expect their incomes to rise in the next year. This is an increase from 72% in March and represents the highest optimism since the survey began in September 2024.
Survey Details
- Conducted in 600 villages covering 6,000 households.
- Fifth round of the survey took place in May 2025.
Income Expectations
- 6.7% foresee a deterioration in their incomes, a decrease from 7.3% in the first survey.
- Optimism linked to predictions of an "above normal" monsoon in 2025, boosting agriculture and consumption.
Real Wages Growth
A report by India Ratings predicts real wages will grow 6.5% Y-o-Y in 2025-26. However, potential adverse weather or geopolitical issues could impact this growth.
Near-term Sentiment
- 53.8% expect better incomes for the July-September quarter, up from 52.5% in March 2025.
Employment Outlook
- 53.5% of households expect improved employment conditions.
- 8% foresee deterioration, resulting in a net positive sentiment of 45.4.
Household Income and Consumption
- 37.4% reported increased income over the past year, up from 34.8% in March.
- Consumption remains strong, with 79.1% reporting increased spending.
Financial Savings
- Only 18.8% saw an increase in savings, while 28.7% saw a decline.
- Net response on savings is negative at 9.9%, marking a slight improvement.
Borrowing Patterns
- 38.6% reported increased borrowings, while 16.8% noted a decline.
- Net response remained stable at 21.8%.
Income Growth Distribution
- 40.5% experienced a 5-10% increase in income.
- 21.9% saw up to 5% increase, 15.6% reported 10-15% growth.
- 12% experienced 15-20% gains, and 10% saw increases over 20%.
- Mean income increase stood at 12.9%, with a median of 10%.
