The size of India’s middle class will nearly double to 61% of its total population by 2047, up from 31% in 2020-21, as continued political stability and economic reforms with a sustained annual growth rate of 6% to 7% over the next two and a half decades will make the country one of the world’s largest markets.
The findings are part of a report released by People Research on India’s Consumer Economy (PRICE) and India’s Citizen Environment. The middle class is anticipated to grow from 432 million individuals in 2020–21 to 715 million (or 47% of the population) in 2030–31 and then 1.02 billion of India’s projected population of 1.66 billion in 2047.
The think tank defines a middle-class Indian as earning between US$ 1,322.77 (Rs. 1.09 lakh) and US$ 7,839.51 (Rs. 6.46 lakh) per year in 2020-21 pricing, or US$ 6,067.74 (Rs. 5 lakh) to US$ 36,406.41 (Rs. 30 lakh) yearly in household terms.
According to Former NITI Aayog Chief Executive Officer, Mr. Amitabh Kant, as the proportion of middle-class households increases, so will the demand for high-quality consumer products, housing, education, and healthcare.
The government will increasingly need to prioritise both job creation and the creation of chances for education and health. The ambition of India to become a fully developed country by 2047 implies that the middle class must be a significant driver of India’s growth story, he stressed.
By the end of this decade, the country’s demographic structure will shift from an inverted pyramid representing a tiny, rich class and a very big low-income class to a rudimentary diamond, with a considerable portion of the low-income class moving up to become part of the middle class.
Furthermore, the report states that between now and 2030-31, India will see a fivefold increase in its super-rich households, with a large portion of the growth coming from rural areas, as the number of super-rich households, those earning more than US$ 2,42,709.40 (Rs. 2 crore) annually, increased from 1.06 million in 2016 to 1.8 million in 2021.
According to the report, the western region has the most super-rich households (803,000 versus 394,000 for the northern states), with Maharashtra (648,000 super-rich households) leading the way, followed by Delhi (181,000), Gujarat (141,000), Tamil Nadu (137,000), and Punjab (101,000).
Maharashtra and Delhi are home to nearly half of India’s exceedingly rich. In terms of expenditure, middle-class households spend 8 times more than poor households, whereas rich households spend approximately 25 times more than poor households.
