A stalled growth engine

Household debt-fuelled growth is not sustainable

The question of whether private consumption demand, particularly from households, can fuel India’s post-pandemic growth revival is a fraught one. In the latest data of gross domestic product, pertaining to the three months between April and June 2021, private final consumption expenditure appeared stable as it continued to account for over 55 per cent of growth — it was 55.1 per cent of real gross domestic product in the second quarter of 2021 as compared to 55.4 per cent in the equivalent quarter of the previous year. The data from the Reserve Bank of India (RBI) suggest that consumer durable