Want to know how Indians spend their money? Read on...

The Indian consumer market is poised to grow 3.6 times between 2010 and 2020, faster than most other emerging markets.

Estimated at $991 billion in 2010, total consumption expenditure is expected to grow to nearly $3.6 trillion in 2020.

Food, housing and consumer durables and transport and communication are expected to be the top three categories, accounting for 65 per cent of consumption in 2020.

Boston Consulting Group, a global management consulting firm, and Confederation of Indian Industry, a non-government, not-for-profit, industry led and industry managed organisation, has presented a report that examines in detail the shape and size of consumption expenditure in India, and its expected evolution over the next decade.

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Lifetime consumption growth comparison in India

Consumption of a child

Life expectancy (years): 42 (if born in 1960)

Life expectancy (years): 64 (if born in 2009)

Per capita consumption at birth: $241 (for those born in 1960)

Per capita consumption at birth: $802 (for those born in 2009)

Per capita consumption at death: $531 (for those born in 1960)

Per capita consumption at death: $6,151 (for those born in 2009)

Life time consumption: $14,645 (for those born in 1960)

Life time consumption: $ 184,556 (for those born in 2009)

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Composition of consumption expenditure in different markets

India

Spending on food: 31 per cent

Spending on housing: 14 per cent

Spending on transport: 18 per cent

Spending on education and leisure: 7 per cent

Spending on durables and household services: 4 per cent

Spending on communication: 2 per cent

Spending on apparel: 6 per cent

Spending on health: 5 per cent

Spending on others: 13 per cent

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China

Spending on food: 25 per cent

Spending on housing: 15 per cent

Spending on transport: 6 per cent

Spending on education and leisure: 19 per cent

Spending on durables and household services: 5 per cent

Spending on communication: 5 per cent

Spending on apparel: 8 per cent

Spending on health: 7 per cent

Spending on others: 12 per cent

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Brazil

Spending on food: 17 per cent

Spending on housing: 20 per cent

Spending on transport: 15 per cent

Spending on education and leisure: 17 per cent

Spending on durables and household services: 7 per cent

Spending on communication: 3 per cent

Spending on apparel: 5 per cent

Spending on health: 6 per cent

Spending on others: 10 per cent

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Western Europe

Spending on food: 16 per cent

Spending on housing: 23 per cent

Spending on transport: 13 per cent

Spending on education and leisure: 19 per cent

Spending on durables and household services: 6 per cent

Spending on communication: 3 per cent

Spending on apparel: 5 per cent

Spending on health: 4 per cent

Spending on others: 11 per cent

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United States

Spending on food: 9 per cent

Spending on housing: 19 per cent

Spending on transport: 10 per cent

Spending on education and leisure: 18 per cent

Spending on durables and household services: 4 per cent

Spending on communication: 2 per cent

Spending on apparel: 4 per cent

Spending on health: 20 per cent

Spending on others: 14 per cent

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Composition of consumption expenditure across segments

Professional affluent

Food: 17 per cent

Apparel: 10 per cent

Housing and consumer durables: 20 per cent

Health: 5 per cent

Transport and communication: 25 per cent

Education and leisure: 7 per cent

Others: 15 per cent

NOTE: Professional affluent (two per cent of households): With an annual household income above $18,500, these consumers are well educated and work as executives, managers or are self employed professionals.

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Traditional affluent

Food: 20 per cent

Apparel: 10 per cent

Housing and consumer durables: 19 per cent

Health: 4 per cent

Transport and communication: 25 per cent

Education and leisure: 6 per cent

Others: 17 per cent

NOTE: Traditional affluent (four per cent of households): With annual household income levels similar to the professional affluent, these consumers are less educated and typically self employed. They are more value conscious and less comfortable with credit than the professional affluent.

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Urban aspirers

Food: 31 per cent

Apparel: 6 per cent

Housing and consumer durables: 18 per cent

Health: 5 per cent

Transport and communication: 21 per cent

Education and leisure: 7 per cent

Others: 12 per cent

NOTE: Urban aspirers (eight per cent of households): With an annual household income between $7,400 and $18,500, these consumers are educated and have mid-sized businesses or stable jobs. They live in urban cities and have high aspirations for their lifestyle.

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Rural aspirers

Food: 35 per cent

Apparel: 4 per cent

Housing and consumer durables: 16 per cent

Health: 5 per cent

Transport and communication: 19 per cent

Education and leisure: 9 per cent

Others: 12 per cent

NOTE: Rural aspirers (six per cent of households): With income levels, education and occupation similar to urban aspirers, these consumers live in rural India. They consume less than their urban counterparts and are comparatively less aspirational.

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Large town next billion

Food: 37 per cent

Apparel: 7 per cent

Housing and consumer durables: 19 per cent

Health: 5 per cent

Transport and communication: 18 per cent

Education and leisure: 5 per cent

Others: 10 per cent

NOTE: Large town next billion (six per cent of households): With incomes between $3,300 and $7,400, these consumers typically have basic education levels and have small businesses or low paying jobs. Their income levels allow them to sustain a basic lifestyle. They live in towns and cities with a population greater than 500,000.

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Small town next billion

Food: 35 per cent

Apparel: 5 per cent

Housing and consumer durables: 17 per cent

Health: 4 per cent

Transport and communication: 19 per cent

Education and leisure: 7 per cent

Others: 12 per cent

NOTE: Small town and rural next billion (24 per cent of households): These consumers are similar to the large town next billion segment, but live in smaller cities and towns and in rural India.

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Strugglers

Food: 42 per cent

Apparel: 5 per cent

Housing and consumer durables: 17 per cent

Health: 5 per cent

Transport and communication: 14 per cent

Education and leisure: 5 per cent

Others: 13 per cent

NOTE: Strugglers (50 per cent of households): With an annual income less than $3,300, typically illiterate with limited education, these consumers have jobs that are manual labour based with very low income, generally daily wage.

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Key macro-economic indicators suggest a 6-7year lag between India and China

GDP per head:

India (2010): $3,582

China (2004): $3,598

China (2010): $7,599

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Personal disposable income:

India (2010): $1,163

China (2004): $871

China (2010): $2,436

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Healthcare spending:

India (2010): $39

China (2004): $39

China (2010): $102

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Private consumption:

India (2010): $843

China (2004): $608

China (2010): $1,471

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Mobile subscribers:

India (2010): $752

China (2004): $335

China (2010): $859

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