Pandemic pushed 32m Indians out of middle class
FINANCIAL issues brought by last year's coronavirus pandemic have pushed about 32 million Indians out of the middle class, undoing years of economic gains, a report shows, while job losses pushed millions into poverty.
The number of Indians in the middle class, or those earning between $10 and $20 (Rs700- Rs1,400) a day, shrunk by about 32 million, compared with the number that could have been reached in the absence of a pandemic, the US-based Pew Research Centre said.
A year into the pandemic, the numbers of those in the middle class has shrunk to 66 million, down a third from a pre-pandemic estimate of 99 million, it added.
"India is estimated to have seen a greater decrease in the middle class and a much sharper rise in poverty than China in the COVID-19 downturn," the Pew Research Centre said, citing the World Bank's forecasts of economic growth.
Nearly 57 million people had joined the middle income group between 2011 and 2019, it added.
In January last year, the World Bank forecast almost the same level of economic growth for India and China, at 5.8 per cent and 5.9 per cent respectively, in 2020.
But nearly a year into the pandemic, the World Bank revised its forecast this January, to a contraction of 9.6 per cent for India and growth of 2 per cent for China.
The Pew Centre estimated the number of poor people, with incomes of $2 or less each day (around Rs145), has gone up by 75 million as the recession brought by the virus has clawed back years of progress.
A rise of nearly 10 per cent in fuel prices this year, job losses and salary cuts have further hurt millions of households, forcing many people to seek jobs overseas.
In China, however, the fall in living standards was modest as numbers in the middle-income category probably decreased by 10 million, while poverty levels remained unchanged, the report added. - NDTV