Shrinking Indian Middle-class…?

By Unknown Enemy on July 23, 2024

DT#1756

Indian middle-class is shrinking means slowly they are falling in the bracket of poor and poor people are sliding down to beggers who lives on government subsidies and dole. (The dole is money that is given regularly by the government to people who are unemployed).

Indian middle-class people facing problems like less savings, more expenses, and a lack of good jobs and the ruling party wants to talk about religion.

Poor lives on government subsidies and rich on government favours and middle-class burdened with new taxes and penalties and so they are bound to shrink and if this continues then they might get extinct…?

Main challenges to middle-class:

• High tax rates: The middle class feels that they are bearing a significant portion of the tax.

• Increased cost of living: The cost of living has increased, making it difficult for the middle class to sustain themselves.

• Limited benefits: The middle class feels that they are not receiving comparable benefits to those being extended to farmers and other sections of society.

So, what has changed for the middle class and the way they live in the past few years? Let's start with how much they save?

The Reserve Bank's own data shows that household net financial savings, the difference between a household's assets and its liabilities, fell sharply to 5.1 per cent of GDP in 2022-23 from 11.5 per cent in 2020-21.

Household savings in India have hit a 47-year low. As savings have dropped, debt levels for households have risen; by December last year, they were at a record high of 40 per cent of Gross Domestic Product (GDP), taking more loans—and feeling excessive spending pinch.

A shrinking middle-class would lead to decreased purchasing power, affecting businesses and industries that relay on consumer spending, slower economic growth and many other social, economics and political are some potential side effects if the middle-class shrinks.

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