Life is not a template and neither is mine. Like several who have worked as journalists, I am a generalist in my over two decade experience across print, global news wires and dotcom firms. But there has been one underlying theme in each phase; life gave me the chance to observe and tell a story -- from early days tracking a securities scam to terror attacks and some of India's most significant court trials. Besides writing, I have jumped fences to become an entrepreneur, as an investment advisor -- and also taught the finer aspects of business journalism to young minds. At Forbes India, I also keep an eye on some of its proprietary specials like the Rich list, GenNext and Celebrity lists. An alumnus of Xavier Institute of Communications and H.R College of Commerce and Economics in Mumbai, I have worked for organisations such as Agence France-Presse, Business Standard, The Financial Express and The Times of India prior to this.
With India’s economy and consumption demand failing to gather pace, one could assume that household savings rate will pick up as people choose to save more. But a consumption slowdown is often led or coupled by an income slowdown, with job losses or salary cuts, and leads to a problem of meeting expenses. In that scenario, household savings would remain low.
India’s households sector accounts for the largest share (over 50 percent) of overall savings (which includes corporates and public). But the households sector’s saving rate has fallen to 17.2 percent in 2017-18 from 23.6 percent of GDP in 2011- 12. This is largely due to a decline in savings in physical assets from 15.9 percent of GDP in 2011-12 to 10.3 percent in 2017-18. FY19 data is unavailable.
The share of household savings—a critical source of funds for investment in the economy—rose to 6.6 percent in 2017-18 from 6.3 percent of GDP in 2016-17. It was 8.1 percent in 2015-16 .
Investments in small savings, based on falling interest rates for PPF, pension schemes and post office deposits, are expected to be sluggish. Investments in gold and silver have fallen in the past four to five years.
It appears, then, that the savings rate, at least for households, will continue to slip in 2020.