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VOL. 7, ISSUE 1 (2025)
A study on trends of household savings in Indian economy
Authors
Isha Bishnoi, Dr. Ashutosh Kumar
Abstract
This paper presents a comprehensive analysis of the trends and components
of household savings in the Indian economy. The research has highlighted the
importance of household savings for the development of an economy. Gross
Domestic Savings consists of savings of Household sector, Private corporate
sector and Public sector. Household savings is the major contributor in Gross
Domestic Savings in India with a contribution of nearly 78 per cent. Economic
Growth of any Nation depends upon the Growth rate of its GDP which in turn
depends on the level of savings. A high level of savings helps the economy to
progress on a continuous growth path since Investment is mainly financed out of
savings. India’s savings performance has been quite impressive since
independence. But with the increase in inflation and changings consumption
habits of consumers, there has been a consistent decline in the savings of
Indian households. Proportion of household goods backed by finance is
increasing. This in turn is reducing the savings of households. During the
period of 2008-2022 household savings in India has declined from its peak of
25.2 per cent to 19 per cent. Thus the Indian economy is chasing the western
culture of high consumption and low savings. Although this pattern promotes a
high GDP growth but on the other hand impose a vulnerability on household in
situation like Covid-19.
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Pages:12-17
How to cite this article:
Isha Bishnoi, Dr. Ashutosh Kumar "A study on trends of household savings in Indian economy". International Journal of Commerce and Economics, Vol 7, Issue 1, 2025, Pages 12-17
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