When the going gets good
From a billion mutinies to a billion bounties, the good times are set to roll as India Struggling becomes India Spending.india Updated: May 04, 2007 23:29 IST
From a billion mutinies to a billion bounties, the good times are set to roll as India Struggling becomes India Spending. A Mckinsey report, ‘Bird of Gold: The Rise of India’s Consumer Market’, suggests that India is going to take P Chidambaram’s famous exhortation “spend, spend, spend” seriously. The report suggests that given an annual growth rate of 7.3 per cent for the next two decades, the Indian market may well overtake that of Germany. The crème de la crème will number about 2.3 crore while those below the poverty line (which will also be a rising line) will be contained at 10 per cent. As the population touches 142 crore, 22 per cent will still be ‘deprived’. Wedged between the middle-class and the lower end, the ‘aspirers’ have already grown from 18 per cent in 1995 to 41 per cent in 2005. According to the study, they will be 41 per cent of the population by 2015, and drop to 36 per cent by 2025, when a sizeable number will have graduated to the middle-class. The semi-rags to semi-couture story.
This class, hungry for more and struggling to get a foot in the door of middle-classdom, is proof that Indians have transformed from lotus-eaters to the striving and restless. They are those who embrace globalisation in the hope that its Midas touch will transport them beyond want. And you find them in the mofussil towns and rustic villages where the father of our nation saw the future of India.
However, pulling them down is the inertia of our bureaucracy and political machinations that seek to keep India trapped in a distorted socialist period. Despite all this, the Mckinsey report shows a rapid rise in expenditure on healthcare from 7 per cent in 2005 to an estimated 13 per cent in 2025. Similarly, Indians will spend more on transport, communication, education and recreation. The report leaves you with a warm glow. But what’s the catch? The ability of the Indian State to provide the wherewithal for education and healthcare, at the very least, to make India truly shining. The pathetic state of public and private schools in the capital alone is discouraging. Neither is there any concerted move to universalise health services. But given the gung-ho spirit of the new-age Indian, he will find a way around it. If the State doesn’t deliver, the public will buy services even if it feels the pinch. Hence, you see that private enterprise will fill the vacuum created by the State. The aspirational classes will not quite be able, like the wealthy, to literally bypass the State. But they are getting there. Warts and all, it’s India Ascending.