Over 75.9% of rural households expect their income to increase in the next year, according to a bi-monthly survey conducted by the National Bank for Agriculture and Rural Development (Nabard) in November 2025.
This represents the highest level among all rounds of the survey which commenced in September, 2024.
The Nabard survey, titled ‘Rural Economic Conditions and Sentiments’, noted “it is possible that the Trump tariff-related impact on farm and non-farm exports, and the associated impact on rural income and employment, is perceived by the households to dampen prospects only in the short-term, but over the next one year they expect the situation to improve.”
The percentage of households expecting a decrease in income next year fell to only 4.3% in November 2025, the lowest level recorded. A year ago, 7.8% of rural households reported a fall in income.
However, 19.8% of rural households reported stagnation in income prospects next year.
What does the survey suggest?
It noted that the November round of the survey was conducted after the GST rate rationalisation announced on September 3, 2025, during the festival season, and against the backdrop of sharp moderation in rural inflation and food deflation.
According to the survey, 79.2% of the rural households reported to have incurred increased consumption expenditure in the last one year, which was also the highest among all bi-monthly rounds conducted in 2025-26 so far.
“The rural consumption demand buoyancy, thus, appears to have received a boost after the GST rate rationalisation, with improved real purchasing power of rural non-farm income due to softer inflation also contributing to the momentum,” the survey has noted.
Over 42.2% of rural households reported to have experienced an increase in income in the last one year, which is the highest level among all rounds of this survey so far.
The percentage of households experiencing a decline in income during the last year fell to its lowest level of 15.7%.
On savings
However, Nabard stated a lower percentage of rural households (21.9%) reported their savings rising during last year, as against 23.7% in the September 2025 round of the survey. There was only a modest increase in the number of households who reported taking recourse to increased borrowings or loans at 36.5% during last year. “Thus, it appears that the higher consumption expenditure of rural households was not funded by excessive recourse to borrowings,” according to the survey
The survey was conducted during the last few days of October 2025 and the first few days of November 2025. The trend of taking increasing recourse to formal sources of credit continued, with 58.3% of rural households reporting to have accessed only formal sources, which is the highest so far among all rounds of this survey.
Meanwhile, the average interest rate on informal credit remained around 17–18% for the 20.8% of households that borrowed only from informal sources. “More than one fourth of the households that borrow from informal sources pay no interest, which could be because they take such loans from friends and relatives,” the survey stated.
