What is the driving force of any economy? It is you and me! It’s the money we work so hard to earn and have fun spending. In fact, private consumption accounts for nearly 61.5% of India’s GDP. Last year alone, consumer spending grew by 7.7%. This makes households one of the biggest contributors to India’s growth story.
Meanwhile, household debt has climbed to 45.5% of GDP, with unsecured loans rising compared to home loans. Indians are moving away from bank deposits and entering stock markets, either through mutual funds or in equities, like never before.
With 93% of the growth in India’s urban consumer class is expected from non-metros by 2040, how are Indians changing the way they save, borrow and spend?
Are these signs that India is becoming a mature consumption-driven economy, or a warning sign for policymakers?
(The views expressed are strictly personal)
Guest: Prof. Smita Roy Trivedi, National Institute of Bank Management
Host: Nivedita V
Edited by Sharmada Venkatasubramanian
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Published – August 03, 2026 04:49 pm IST
