2 Wheelers Go Out of Reach For Rural Indians!
Two-wheeler sales in India have been a strong indicator of the health of the rural economy since the turn of this century. Rising motorcycle sales indicate that rural India’s discretionary incomes are rising, and they are becoming more mobile which furthers their income and quality of life. From 2001 to 2011, two-wheeler registrations in India increased from 40m to 100m. In the decade after that, more than 10 million two-wheelers were sold each year with a peak of 16.5 m in 2018.
But since then a gradual decline is witnessed and in 2021 the number of two wheelers sold were less than 2012. The decline is hastened by the impact of Covid pandemic which has shrunk the rural incomes as millions of migrant workers lost their city jobs and went back to their homes. In the last quarter of 2021 two-wheeler sales were 3.59m which is the worst quarter in a decade.
This is the quarter when festive season sale usually experiences a spike across the country. Passenger vehicles too faced a hit during this period but not as bad as the motorcycle riding lower middle class. Clearly, even two wheelers – priced between Rs 50,000 and Rs 100000 - are now out of the reach of a massive Indian population.
These figures correspond to the shrinking per capita income in India which has reduced to less than Rs 1 lakh for the first time in four years. Sentiment among the consumers having incomes of above Rs 1 lakh a year have strengthened during the post pandemic period but those earning less than Rs 1 lakh have remain subdued during this time. Data released by the Centre of Monitoring Indian Economy reflects this trend and the correlation between the two trends.
With Union Budget to be presented on February 1, the government must take corrective actions. Its large Rs 20 Lakh crore stimulus package has either remained on the files, or its benefits have not trickled down to the poorest sections of Indian hinterland. Though claims have been made that billions of rupees have been transferred to small farmers and landless workers in the rural areas, the money in their hands is not enough to buy two-wheelers which are now the most visible signs of rural upward mobility.
But since then a gradual decline is witnessed and in 2021 the number of two wheelers sold were less than 2012. The decline is hastened by the impact of Covid pandemic which has shrunk the rural incomes as millions of migrant workers lost their city jobs and went back to their homes. In the last quarter of 2021 two-wheeler sales were 3.59m which is the worst quarter in a decade.
This is the quarter when festive season sale usually experiences a spike across the country. Passenger vehicles too faced a hit during this period but not as bad as the motorcycle riding lower middle class. Clearly, even two wheelers – priced between Rs 50,000 and Rs 100000 - are now out of the reach of a massive Indian population.
These figures correspond to the shrinking per capita income in India which has reduced to less than Rs 1 lakh for the first time in four years. Sentiment among the consumers having incomes of above Rs 1 lakh a year have strengthened during the post pandemic period but those earning less than Rs 1 lakh have remain subdued during this time. Data released by the Centre of Monitoring Indian Economy reflects this trend and the correlation between the two trends.
With Union Budget to be presented on February 1, the government must take corrective actions. Its large Rs 20 Lakh crore stimulus package has either remained on the files, or its benefits have not trickled down to the poorest sections of Indian hinterland. Though claims have been made that billions of rupees have been transferred to small farmers and landless workers in the rural areas, the money in their hands is not enough to buy two-wheelers which are now the most visible signs of rural upward mobility.
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