Skip to main content

India's wealth differences between top and bottom are huge, middle class wealth share is shrinking: Credit Suisse report

By Our Representative
A new report, “Global Wealth Databook 2015” by top a global financial services firm based in Zurich, Credit Suisse, has found the existence of huge wealth differences in India. The report says that 755,563,000, or 95.4 per cent of adults in India, own wealth less than $10,000, while a minuscule 185,000, or 0.023 per cent of Indian adults, own more than $1 million.
The report has two other categories falling in between – those owning wealth between $10,000 and $100,000, and those owning between $100,000 and $1 million. While India’s 33,867,000 adults, or 4.28 per cent, fall in the former category, another 2,413,000 adults, or 0.3 per cent adults, fall in the latter category. In all, there are 790,022,000 adults in the country.
The report, which gives a new definition of the middle class by making wealth as the basic criterion, says that “to be a member of the middle class in 2015, according to our methodology, an adult needs at least USD 28,000 in Brazil, Chile and China; USD 22,000 in South Africa and Turkey; USD 18,000 in Malaysia, Russia and Thailand; and just USD 13,700 in India.”
Those with USD of 13,700 in India, or Rs 9.04 lakh under the present rupee-dollar rate or Rs 66 per dollar, form only 3% of adults having wealth above the middle class minimum, saying the “situation in Africa as a whole is almost identical.”
The report sharply disagrees with those who define middle class on the basis of income or consumption pattern. Based on the income method, in 2005, the World Bank had estimated middle class population at 264 million, using the median poverty line in 70 countries at the lower extreme ($2 per day), and the United States poverty line ($13 per day) as an upper extreme.
The other method, of using the consumption-based, criterion, (ownership of car or scooter, colour television, or telephone in households), found that India 20 per cent of population, or slightly over 200 million, belonged to the middle class.
Basing its calculation of the middle class on the basis of the ownership of wealth ($13,700 or more), the report finds that in India its share is 22.6% ($780 billion) of the country’s wealth. However, it finds that this share is declining over the last 15 years – it was 26.8 per cent in the year 2000, remained almost constant till 2007 at 26.4 per cent, but began declining to reach 24.9 per cent in 2008, 23.2 per cent in 2013, 23 per cent in 2014, and 22.6 per cent in 2015.
“Across regions, the middle class is most prevalent in North America, where 39 per cent of adults qualify, followed by Europe, where the proportion is one third. The share then drops sharply, to 15 per cent for the Asia-Pacific region (excluding China and India), around 11 per cent in China and Latin America, and just 3 per cent in Africa and India”, it says. 
Wealth per capita overtime in India
“The size and wealth of the middle class varies greatly across countries, ranging from 3% of the adult population in India to 66% of adults in Australia”, the report says, adding, “Surprisingly, only 38 per cent of adults in the United States qualify as middle class according to our criterion, a much lower percentage than the 50% to 60% figure found in most high income countries.”
Comparing China’s middle class with that of India, the report says, “In China the number of middle class adults grew by 38 million between 2000 and 2015, and their wealth rose by $5.6 trillion. As a consequence, there are now more global middle class members in China (109 million) than there are in the United States (92 million). In contrast, India added only 6.7 million adults to the middle class, and middle class wealth rose by just $1.2 trillion.”
It adds, “This divergence in experiences is partly due to faster overall wealth growth in China, and partly because the populous mid-portion of the Chinese wealth distribution is moving into the global middle class, whereas it is still far from doing so in India.”

Comments

TRENDING

World Bank clarifies: Its 26th rank to India not for universal access to power but for ease of doing business

By Our Representative
In a major embarrassment to the Government of India, the World Bank has reportedly clarified that it has not ranked India 26th out of 130 countries for providing power to its population. The top international banker’s clarification comes following Union Power Minister Piyush Goyal’s claim that India has “improved to 26 position from 99” in access to electricity in just one year.

Mental health: India's 95% patients "deprived" of medical care, treatment gap 70%

By Moin Qazi*
Among the many challenges India faces, the most underappreciated is the ongoing mental health crisis. Mental illness is actually India’s ticking bomb. An estimated 56 million Indians suffer from depression, and 38 million from anxiety disorders. For those who suffer from mental illness, life can seem like a terrible prison from which there is no hope of escape; they are left forlorn and abandoned, stigmatized, shunned and misunderstood.

Modi model? "Refusal" to build Narmada's micro canals, keep Kutch dry; help industry

By Medha Patkar*
This is the latest photograph of the Kutch Branch Canal (KBC) of the Sardar Sarovar, as of April 8! What does it show, expose, and what memories do you recall? Is it dry or dead? Is it a canal or a carcass of the same?

Bill Gates "promoting" GMO, Bt cotton, like cartels that have roots in Hitler's Germany

By Our Representative
World-renowned environmental leader and ecologist Dr Vandana Shiva has expressed concern that Bill Gates, founder of Microsoft Corporation, has joined the bandwagon of “a poison cartel of three" – Monsanto and Bayer, Syngenta and ChemChina, Dow and DuPont – all of whom allegedly have “roots in Hitler’s Germany and finding chemicals to kill people”.

Indian talc products contain "contaminated" asbestos structures, can cause cancer: Study

Counterview Desk
A recent study, using polarizing light microscopy, transmission electron microscopy (TEM), electron diffraction, and X-ray analysis on multiple over-the-counter Indian talc products for the presence of asbestos, has concluded that large quantities of body talc products are likely to pose a public health risk for asbestos-related diseases, especially for the cancers related to asbestos exposure.

Why are you silent on discrimination against Dalit jawans? Macwan questions Modi

By Rajiv Shah
Close on the heels of releasing his book in Gujarati, "Bhed Bharat", which lists 319 cases of atrocities against Dalits and Adivasis across the country over the last five years, well-known Gujarat Dalit rights leader Martin Macwan has shot an open letter to Prime Minister Narendra Modi, telling him the reasons why he does not want vote for the BJP.

Jharkhand Adivasi lynched to death by mob "chanting" Jai Shri Ram: Fact-finding team

Counterview Desk
On April 10, 2019, Prakash Lakda, a 50-year old Adivasi of Jurmu village of Gumla’s Dumri block, was lynched to death by a mob of men from the Sahu community of neighbouring Jairagi village. Three other victims from Jurmu – Peter Kerketta, Belarius Minj and Janerius Minj – sustained severe injuries due to the beating by the mob. A fact-finding team of Jharkhand Janadhikar Mahasabha (JJM), comprising of several activists and representatives of member organisations, conducted a fact-finding inquiry into the incident on April 14-15.

Investigation shows Narmada downstream "seriously" polluted. Reason: apathy, greed

By Rohit Prajapati, Krishnakant, Swati Desai*
Our investigation regarding quality of water flowing in the Narmada river downstream of the Sardar Sarovar Dam (SSD), dated April 6, 2019, between 11.00 a.m. to 4.00 p.m. reiterates, what is commonly known now, that the Sardar Sarovar Project (SSP) is planned without considering its impact on the downstream Narmada River stretch of 161 kilometres, its ecology, biodiversity and fishery, and lakhs of people living close to and dependent on the river directly or indirectly. This, in turn, has led to its present disastrous state.

Emergence of a rare Dalit teacher in IIT-Kanpur "disturbed" certain faculty members

By PS Krishnan, IAS (Retd)*
Dr Subrahmanyam Sadrela, a faculty member in the Department of Aerospace Engineering, Indian Institute of Technology (IIT)-Kanpur since January 1, 2018, and one of the rare Dalit members of the faculty in IIT group of institutions, is facing the threat of revocation of his PhD thesis, and thereby also jeopardizing his job and career.

RTE in remote areas? Govt of India "plans" to close down 2.4 lakh schools

By Srijita Majumder*
The Right to Education (RTE) Act, 2009, came into effect on April 1, 2010, for the first time made it obligatory on the part of the State to provide free and compulsory education to all children from 6-14 years of age in India. The Act, despite its limitations, had progressive elements like neighbourhood schools, community participation, ban on corporal punishment, no detention, continuous and comprehensive evaluation and it hence it appeared that India was not far from achieving universal elementary education.