P Sundarajan is new Google CEO

[Mad Indian]

Right @ezsasa, the statistics being thrown around by @CrYsIs definitely stink. Like they say, "95% of all statistics are manufactured on the spot".

If one claims that any family earning above 18000 is "middle class", then your national middle-class is close to 300 million. If one claims that any PERSON earning above 18000 is "middle class" (completely ignoring housewives and children), then the national middle-class is close to 80 million (out of a base size of 600 million, since housewives and kids have been ignored).

You just cannot claim on the one hand that 18K is the definition for middle-class, and then claim that only 3% of PEOPLE in India out of 1300 million are middle-class. The figures don't tally, it defies common sense and has more holes than a sieve.

Out of 600 Million? Nearly 50% of our population is below 25yrs of age. and 50% of the rest is women. So how much of 1.3bn people should we count when we count a single household/man income?

Also, household income is a much better reflection of wealth. And IMO PPP $ percapita is how you compare the wealth. Our is currently 5800-6000$ per capita. I think we would be out of miserable poverty if we can rise it to 10k-12k$ per capita which is just 1 decade of growth away. So everything is fine. We can do better yes, and a bit worse under CONs yes, but so long as we dont go full retard and vote in Commies, I think we are absolutely fine

 

[Bangalorean]

@Mad Indian

Regarding middle-class, whether we want to include autowallahs or not depends on how we want to perceive middle-class as. If it means someone who earns more than 20K per month, then autowallahs are definitely there. If however, it means that one needs to own consumer goods and live in a house of a certain size, not live in chawls/slums etc., then it becomes different.

That is why estimates of middle class range from 400 million to 36 million or lower.

And yes, there is definitely a great story unfolding before our very eyes. 10 years down the line India will be radically different. The changes that we have seen before our very eyes are astounding to say the least. I wish the naysayers would think back to the hole our country was in, even 20 years ago and make some comparisons.

Whether BJP or Congress, India will be a radically different nation in a decade.

 

[Sakal Gharelu Ustad]

India would be screwed if major bills keep getting stuck the way they did in this Parliament session.

India is moving into a different phase now and cannot be managed by lethargic govt. interventions. It needs robust laws.

 

[SamwiseTheBrave]

agree with @Bangalorean the next time anyone takes a ride in an auto booked using ola or uber, do strike up a conversation with the driver and try to get an approx. idea of his monthly salary. its an eye-popping 25k+ at least depending on the number of hours put in by the driver. the pay is directly linked to the customer ratings.
using such india-specific business models,its very much possible to increase average earnings across the population whilst still providing valuable, in demand services and making a good profit i.e. a win-win-win !

 

[CrYsIs]

@CrYsIs
Income growth has been on the rise. In 2014, the average Indian household income was Rs 3.35 lakh compared to Rs 2.19 lakh in 2005. The richest households (the top 20%) had an average income of Rs 6.69 lakh compared to Rs 5.19 lakh nearly a decade ago. The lowest income households (the bottom 20%) too had increased their income from Rs 64,137 in 2005 to Rs 1,36,708 in 2014. While the poorest households are still in rural areas (83%), the interesting fact is that nearly 45% of the richest households too live in rural India.

http://www.financialexpress.com/art...ing-the-path-towards-inclusive-growth/117111/

At 3.35 lakh, average income overall will be around 28000 per month per household. This PEW 18k number seems to be based on 2005 numbers.

The PEW research data is from 2011

There are gazillions of organization with gazillions of reports.There is one Boston consulting Group which claimed that India had more middle class than China and there few others which claim that India has no middle class and then there are our own Indian surveys which brands even poor as middle class.

The stats you posted is from India's Consumer Economy survey 360,a new non profit organization which does surveys on market and consumerism.

It's upto you,you can go with anyone you want.But i will stick to PEW because it's more closer to what most reputed organizations are saying.

Even the government figures does not agree with this ICE 360 survey.The government conducted a SOCIO ECONOMIC AND CASTE survey along with the census of 2011 and found that 75% of rural Indian households live below RS 5000 and 92% live below Rs 10,000 a month.So of the 300 million households in the country,nearly 200 million live on less than Rs 1.20 lakh a year,then how is it possible that an average Indian family earns 3.35 lakhs ?

 

[CrYsIs]

@CrYsIs

First tell me, is your PEW "research" referring to number of PEOPLE in the middle class (3% of Indian people) or number of FAMILIES in the middle class (3% of Indian families)? Your fancy bar graph seemed to speak about people, which means only 4 crore people in middle class. But in later posts you are talking about families, which means 15-16 crore in middle class. In other words, 160 million people in middle class.

First clarify what you mean.

Sorry for the mistake.

PEW days says 3% of Indians are middle class or 3.2 crore individuals.

 

[Rowdy]

I agree ................ Lots of people stuck in the low income trap

 

[ezsasa]

The PEW research data is from 2011

There are gazillions of organization with gazillions of reports.There is one Boston consulting Group which claimed that India had more middle class than China and there few others which claim that India has no middle class and then there are our own Indian surveys which brands even poor as middle class.

The stats you posted is from India's Consumer Economy survey 360,a new non profit organization which does surveys on market and consumerism.

It's upto you,you can go with anyone you want.But i will stick to PEW because it's more closer to what most reputed organizations are saying.

Even the government figures does not agree with this ICE 360 survey.The government conducted a SOCIO ECONOMIC AND CASTE survey along with the census of 2011 and found that 75% of rural Indian households live below RS 5000 and 92% live below Rs 10,000 a month.So of the 300 million households in the country,nearly 200 million live on less than Rs 1.20 lakh a year,then how is it possible that an average Indian family earns 3.35 lakhs ?

My point is, try to make assumptions with the latest data analysis available. Frankly in my opinion any sort assessments prior to 2014 are largely irrelevant in indian context. In countries where GDP growth rate is less than 3%, any assessment done will hold good for five years or so, but in our case economic outlook changes almost every two years.

As for these foreign research think tanks are concerned, learn to accept them with a pinch of salt. Firstly they change their conclusions based on whoever is funding that particular study. secondly we may never know the calculation methodology they used to arrive at their findings. And thirdly we keep discussing on this very forum how little outsiders understand india a sociological front, maybe we have to maintain the same level of scepticism while considering reports on economic front coming from outside. I am betting that two years down the line the same PEW will be writing duets about india.

let me have a look at the 2011 census data. i haven't looked closely at that data, as a practice i don't rely on somebody else's opinion.

 

[ezsasa]

Even the government figures does not agree with this ICE 360 survey.The government conducted a SOCIO ECONOMIC AND CASTE survey along with the census of 2011 and found that 75% of rural Indian households live below RS 5000 and 92% live below Rs 10,000 a month.So of the 300 million households in the country,nearly 200 million live on less than Rs 1.20 lakh a year,then how is it possible that an average Indian family earns 3.35 lakhs ?

On 2011 census data...
Firstly, data collected is mainly focussed on rural india.
Secondly, They are counting the highest earning member between 5k-10k not for the entire family. that would mean data does not indicate total household income.
Thirdly, There is a heavy possibility of difference between average incomes of rural and urban india. This is called economic disparity, removing this is the toughest challenge.

 

[Mad Indian]

Thirdly, There is a heavy possibility of difference between average incomes of rural and urban india. This is called economic disparity, removing this is the toughest challenge.

Well if you compare it on PPP level, the difference between urban and rural household income is not that different to be considered a "problem"

A tbhk room in rural India costs 1500-2000rupees in rent in rural areas. What is the cost in Hyderabad? In rural India, salaries like 10k per month is golden, enough to lead a very good lifestyle. What about cities? And in rural areas, the schools which are present charge max 10- 20k per student per year in fees. What about in urban areas?

And so anyone who is talking about absolute income levels in rural and urban areas and decides that rural India is poor and inhumanly so is a big idiot.

@Bangalorean see the autowallahs being counted as a middle class is a actually a good sign for the economy. That's how a good economic growth and good developed country is supposed to look like. Have you heard of drivers, mechanics and cooks being counted as poor people in the west? In developed countries , any job so long as it is productive and un-sbsidised will be good enough to lead a healthy comfortable life.

White collar jobs is not the only sign/requirement of being middle class and dismantling it in practice is what constitutes the first sign of equitable economic growth.

And of course, you do know that even the govt employees get a salary of 25-35k rupees per month right? So will you consider them yo be non middle class if you are going to exclude drivers and autowallahs earning similar amount as non middle class?

 

[Mad Indian]

And IMO 4.5million middle class a year is too low a number to celebrate.

It translates to- 90million in 20years. So take the another 90million as present middle class population, the total middle class will be - 180 million out of the then population of 1.4bn. It would be nothing.

But let's compare the comparative per capita PPP figures. Right now, the per capita PPP is 6000$. Let's say it doubles every ten years(not unreasonable at 7-8% growth rate). After twenty years, the average per capita income will be 24k$. Tell me on what universe will a per capita income of 24k$ translate to less than 1/5 of Indians counting as middle class if you take the 4.5 million as the no. Of middle class added each year?

If anything , our middle class will be 700-800million people or more (and I am being extremely conservative here).

This is the magic of compounded interest

 

[ezsasa]

Well if you compare it on PPP level, the difference between urban and rural household income is not that different to be considered a "problem"

A tbhk room in rural India costs 1500-2000rupees in rent in rural areas. What is the cost in Hyderabad? In rural India, salaries like 10k per month is golden, enough to lead a very good lifestyle. What about cities? And in rural areas, the schools which are present charge max 10- 20k per student per year in fees. What about in urban areas?

And so anyone who is talking about absolute income levels in rural and urban areas and decides that rural India is poor and inhumanly so is a big idiot.

i don't think people look economic disparity in the way you are looking at it. Your argument sounds good if you replace the word "PPP" with "Cost of living". Irrespective of any where in the world difference between urban and rural "Cost of living" will always remain .

when we talk of economic parity, it means that income of the the poor in the society is sufficient to maintain a healthy lifestyle. this is usually achieved by minimum statuatory wages and health benefits etc....

 

[Rowdy]

@Bangalorean see the autowallahs being counted as a middle class is a actually a good sign for the economy. That's how a good economic growth and good developed country is supposed to look like. Have you heard of drivers, mechanics and cooks being counted as poor people in the west? In developed countries , any job so long as it is productive and un-sbsidised will be good enough to lead a healthy comfortable life.

dude the consumption levels of "autowallahs" in the west is sky high... so this statement is not valid

 

[Mad Indian]

i don't think people look economic disparity in the way you are looking at it. Your argument sounds good if you replace the word "PPP" with "Cost of living". Irrespective of any where in the world difference between urban and rural "Cost of living" will always remain .

when we talk of economic parity, it means that income of the the poor in the society is sufficient to maintain a healthy lifestyle. this is usually achieved by minimum statuatory wages and health benefits etc....

1. Most of the economists wont take you seriously when you talk about rural urban divide without taking into account the cost of living. But many journalists and presstitutes will as it can generate lot of outrage among the unwashed uneducated masses. It is a good outrage generator, nothing more- this urban rural divide which does not account for cost of living/PPP

2. Dude, Minimum wage laws are worth shit in accomplishing anything in real life. There are already threads here in DFI where I and Sakal have given so many reasons why it is so. But here I would like to quote the famous economist Thomas sowell on Minimum wage


“Unfortunately, the real minimum wage is always zero, regardless of the laws, and that is the wage that many workers receive in the wake of the creation or escalation of a government-mandated minimum wage, because they lose their jobs or fail to find jobs when they enter the labor force. Making it illegal to pay less than a given amount does not make a worker’s productivity worth that amount—and, if it is not, that worker is unlikely to be employed.”

So the best way to combat poverty is further liberalisation and market reforms and let the market take care of it. Seriously, when people talk about economic reforms, they are not meaning to further bog down the already retarded bureaucracy and red tape with further useless regulations on minimum wage

 

[Mad Indian]

dude the consumption levels of "autowallahs" in the west is sky high... so this statement is not valid

@Rowdy What I meant was, that if India is actually providing an inclusive growth, being a driver or an autowallah should also allow you to earn enough for a middle class life style. Anyway, tell me at what point do you want the cut off for middle class to be?

Because I am not talking out of my ass regarding autowallahs' monthly income. They really do earn between 15k-30k per month depending on how much they work

 

[Mad Indian]

Even the government figures does not agree with this ICE 360 survey.The government conducted a SOCIO ECONOMIC AND CASTE survey along with the census of 2011 and found that 75% of rural Indian households live below RS 5000 and 92% live below Rs 10,000 a month.So of the 300 million households in the country,nearly 200 million live on less than Rs 1.20 lakh a year,then how is it possible that an average Indian family earns 3.35 lakhs

LOL. 10K income per month is a perfectly awesome income for a rural house hold. It translates above the 2$ PPP per capita per day day level for poverty, specially when you consider what the PDS, govt schools, govt hospitals etc are providing for them for free of cost/subsidised cost

 

[Rowdy]

@Rowdy What I meant was, that if India is actually providing an inclusive growth, being a driver or an autowallah should also allow you to earn enough for a middle class life style. Anyway, tell me at what point do you want the cut off for middle class to be?

Because I am not talking out of my ass regarding autowallahs' monthly income. They really do earn between 15k-30k per month depending on how much they work

Consumption is a better indicator.
So if an autowallah has health insurance, Education (skill /certification not college necessarily ), country standard savings rate - 30 % , etc . the details can be worked out. this will account for the difference between Mumbai & say bihar (as salary will be higher in Mum also cost of living, so we can compare )

 

[Mad Indian]

Consumption is a better indicator.
So if an autowallah has health insurance, Education (skill /certification not college necessarily ), country standard savings rate - 30 % , etc . the details can be worked out. this will account for the difference between Mumbai & say bihar (as salary will be higher in Mum also cost of living, so we can compare )

So if I earn 30k per month without education , then I am poor?

Dude, wth does certification of skill has anything to do with being middle class? What ultimately matters is the living standards. So that's why I asked you what would you consider as a cut off point for middle class. And I am asking you again. What income will you define as middle class income? You can name it for specific cities if you want.

Education/insurance/certificates is not prerequistic for being middle class. I don't know where you got that idea from. May be its from the age old Indian mentality rooted from the days of glorious socialism where the only way to become middle class was by getting a govt job which involved getting an education. And if certification is needed for being middle class, are drivers in govt transport corporations in TN who earn 35-40k per month poor and not middle class? Some of them are so poor that they could afford sending their children to private medical colleges which have annual fees of 4-5lakhs per annum . Seriously dude get with the times!

 

[Mad Indian]

And this is one thing you guys should learn- contrary to what socialist and communist retards say, capitalism actually reduces the wealth gap .for instance, middle class ,which is traditionally a white collor associated class in socialist shitholes is now open to autowallahs, drivers and other blue collar works too.

This is the reason why capitalist countries have much smaller gap between high end jobs and low end jobs.

 

[Rowdy]

So if I earn 30k per month without education , then I am poor?

Dude, wth does certification of skill has anything to do with being middle class? What ultimately matters is the living standards. So that's why I asked you what would you consider as a cut off point for middle class. And I am asking you again. What income will you define as middle class income? You can name it for specific cities if you want.

Education/insurance/certificates is not prerequistic for being middle class. I don't know where you got that idea from. May be its from the age old Indian mentality rooted from the days of glorious socialism where the only way to become middle class was by getting a govt job which involved getting an education. And if certification is needed for being middle class, are drivers in govt transport corporations in TN who earn 35-40k per month poor and not middle class? Some of them are so poor that they could afford sending their children to private medical colleges which have annual fees of 4-5lakhs per annum . Seriously dude get with the times!

Please read everything and I wrote certification because here in Europe you can not drive a taxi without one. i said CONSUMPTION.