Standard of living in India
Encyclopedia
With one of the fastest growing economies in the world
, clocked at a growth rate
of 8.3% in 2010, India is fast on its way to becoming a large and globally important consumer economy
. The Indian middle class
, estimated to be 150 million people, by McKinsey is fast becoming used to Western culture
. It will reach 600 million by 2030. According to Deutsche Research the estimates are nearly 300 million people for all Middle Class. If current trends continue, Indian per capita purchasing power parity
will significantly increase from 4.7 to 6.1 percent of the world share by 2015. In 2006, 22 percent of Indians lived under the poverty line. India aims to eradicate poverty by 2020.
According to NCAER, India's middle class population to touch 267 million in 5 yrs. Further ahead, by 2025-26 the number of middle class households in India is likely to more than double from the 2015-16 levels to 113.8 million households or 547 million individuals.
.
The standard of living in India shows large disparity. For example, rural areas of India exist with very basic (or even non-existent) medical facilities, while cities boast of world class medical establishments. Similarly, the very latest machinery may be used in some construction projects, but many construction workers work without mechanisation in most projects.
In 2010, the per capita PPP-adjusted GDP for India
was US$3,608.
On the other hand, the Planning Commission of India uses its own criteria and has estimated that 27.5% of the population was living below the poverty line in 2004–2005, down from 51.3% in 1977–1978, and 36% in 1993-1994. The source for this was the 61st round of the National Sample Survey (NSS) and the criterion used was monthly per capita consumption expenditure below Rs. 356.35 for rural areas and Rs. 538.60 for urban areas. 75% of the poor are in rural areas, most of them are daily wagers
, self-employed householders and landless labourers.
Although Indian economy has grown steadily over the last two decades, its growth has been uneven when comparing different social groups, economic groups, geographic regions, and rural and urban areas. Between 1999 and 2008, the annualized growth rates for Gujarat (8.8%), Haryana
(8.7%), or Delhi
(7.4%) were much higher than for Bihar
(6%), Uttar Pradesh
(7%), or Madhya Pradesh
(5%). Poverty rates in rural Orissa
(43%) and rural Bihar
(41%) are higher than in the world's poorest countries such as Malawi
.
Since the early 1950s, successive governments have implemented various schemes, under planning
, to alleviate poverty, that have met with partial success. Programmes like Food for work and National Rural Employment Programme have attempted to use the unemployed to generate productive assets and build rural infrastructure. In August 2005, the Indian parliament
passed the Rural Employment Guarantee Bill, the largest programme of this type, in terms of cost and coverage, which promises 100 days of minimum wage employment to every rural household in 200 of India's 600 districts
. The Indian government is planning to bring in more economic reforms which can help farmers and unskilled labourers transition into industrialized sectors.
Since independence, India has allocated nearly half of the total outlay of the five-year plans for infrastructural
development. Much of the total outlay was spent on large projects in the area of irrigation, energy, transport, communications and social overheads. Development of infrastructure was completely in the hands of the public sector and was plagued by corruption, bureaucratic inefficiencies, urban-bias and an inability to scale investment.
Calcutta city was the first city in India to boast of a metro-system.Today the calcutta metro is considered among the world's best in terms of service and infrastructure.
India's low spending on power, construction, transportation, telecommunications and real estate
, at $31 billion or 6% of GDP in 2002 has prevented India from sustaining a growth rate of around 8%. This has prompted the government to partially open up infrastructure to the private sector allowing foreign investment. India holds second position in the world in roadways' construction.
As of 31 December 2005, there were an estimated 835,000 broadband lines in India. Low tele-density is the major hurdle for slow pickup in broadband services. Over 76% of the broadband lines were via DSL and the rest via cable modems.
A 2007 study by the Asian Development Bank showed that in 20 cities the average duration of water supply was only 4.3 hours per day. No city had a continuous water supply. The longest duration of supply was 12 hours per day in Chandigarh
, and the lowest was 9 hours per day in Rajkot.
was 0.3% (5.2% & 4.9%) during 1980–81 to 1990–91, but had grown to 3.3% (6.3% & 3.0%) during 1990–91 to 1997–98. Per Capita Income in India varies drastically. As of 2010, New Delhi had a Per Capita Income of $ 3,020 whereas Bihar's Per Capita Income was at a paltry $ 445.
The five-year plans have attempted to reduce regional disparities by encouraging industrial development in the interior regions, but industries still tend to concentrate around urban areas and port cities. Even the industrial townships in the interiors, Bhilai
for instance, resulted in very little development in the surrounding areas. After liberalisation, the disparities have grown despite the efforts of the union government in reducing them. Part of the reason being that manufacturing and services and not agriculture are the engines of growth. The more advanced states are better placed to benefit from them, with infrastructure like well developed ports, urbanisation and an educated and skilled workforce which attract manufacturing and service sectors. The union and state governments of backward regions are trying to reduce the disparities by offering tax holidays, cheap land, etc., and focusing more on sectors like tourism, which although being geographically and historically determined, can become a source of growth and is faster to develop than other sectors.
World
World is a common name for the whole of human civilization, specifically human experience, history, or the human condition in general, worldwide, i.e. anywhere on Earth....
, clocked at a growth rate
Economic growth
In economics, economic growth is defined as the increasing capacity of the economy to satisfy the wants of goods and services of the members of society. Economic growth is enabled by increases in productivity, which lowers the inputs for a given amount of output. Lowered costs increase demand...
of 8.3% in 2010, India is fast on its way to becoming a large and globally important consumer economy
Consumer economy
A consumer economy describes an economy driven by consumer spending as a percent of its gross domestic product, as opposed to the other major components of GDP ....
. The Indian middle class
Middle class
The middle class is any class of people in the middle of a societal hierarchy. In Weberian socio-economic terms, the middle class is the broad group of people in contemporary society who fall socio-economically between the working class and upper class....
, estimated to be 150 million people, by McKinsey is fast becoming used to Western culture
Western culture
Western culture, sometimes equated with Western civilization or European civilization, refers to cultures of European origin and is used very broadly to refer to a heritage of social norms, ethical values, traditional customs, religious beliefs, political systems, and specific artifacts and...
. It will reach 600 million by 2030. According to Deutsche Research the estimates are nearly 300 million people for all Middle Class. If current trends continue, Indian per capita purchasing power parity
Purchasing power parity
In economics, purchasing power parity is a condition between countries where an amount of money has the same purchasing power in different countries. The prices of the goods between the countries would only reflect the exchange rates...
will significantly increase from 4.7 to 6.1 percent of the world share by 2015. In 2006, 22 percent of Indians lived under the poverty line. India aims to eradicate poverty by 2020.
According to NCAER, India's middle class population to touch 267 million in 5 yrs. Further ahead, by 2025-26 the number of middle class households in India is likely to more than double from the 2015-16 levels to 113.8 million households or 547 million individuals.
.
The standard of living in India shows large disparity. For example, rural areas of India exist with very basic (or even non-existent) medical facilities, while cities boast of world class medical establishments. Similarly, the very latest machinery may be used in some construction projects, but many construction workers work without mechanisation in most projects.
In 2010, the per capita PPP-adjusted GDP for India
India
India , officially the Republic of India , is a country in South Asia. It is the seventh-largest country by geographical area, the second-most populous country with over 1.2 billion people, and the most populous democracy in the world...
was US$3,608.
Poverty
A 24.3% of the population earned less than $1 (PPP, around $0.25 in nominal terms) a day in 2005, down from 42.1% in 1981. 41.6% of its population is living below the new international poverty line of $1.25 (PPP) per day, down from 59.8% in 1981. The World Bank further estimates that a third of the global poor now reside in India.On the other hand, the Planning Commission of India uses its own criteria and has estimated that 27.5% of the population was living below the poverty line in 2004–2005, down from 51.3% in 1977–1978, and 36% in 1993-1994. The source for this was the 61st round of the National Sample Survey (NSS) and the criterion used was monthly per capita consumption expenditure below Rs. 356.35 for rural areas and Rs. 538.60 for urban areas. 75% of the poor are in rural areas, most of them are daily wagers
Wage
A wage is a compensation, usually financial, received by workers in exchange for their labor.Compensation in terms of wages is given to workers and compensation in terms of salary is given to employees...
, self-employed householders and landless labourers.
Although Indian economy has grown steadily over the last two decades, its growth has been uneven when comparing different social groups, economic groups, geographic regions, and rural and urban areas. Between 1999 and 2008, the annualized growth rates for Gujarat (8.8%), Haryana
Haryana
Haryana is a state in India. Historically, it has been a part of the Kuru region in North India. The name Haryana is found mentioned in the 12th century AD by the apabhramsha writer Vibudh Shridhar . It is bordered by Punjab and Himachal Pradesh to the north, and by Rajasthan to the west and south...
(8.7%), or Delhi
Delhi
Delhi , officially National Capital Territory of Delhi , is the largest metropolis by area and the second-largest by population in India, next to Mumbai. It is the eighth largest metropolis in the world by population with 16,753,265 inhabitants in the Territory at the 2011 Census...
(7.4%) were much higher than for Bihar
Bihar
Bihar is a state in eastern India. It is the 12th largest state in terms of geographical size at and 3rd largest by population. Almost 58% of Biharis are below the age of 25, which is the highest proportion in India....
(6%), Uttar Pradesh
Uttar Pradesh
Uttar Pradesh abbreviation U.P. , is a state located in the northern part of India. With a population of over 200 million people, it is India's most populous state, as well as the world's most populous sub-national entity...
(7%), or Madhya Pradesh
Madhya Pradesh
Madhya Pradesh , often called the Heart of India, is a state in central India. Its capital is Bhopal and Indore is the largest city....
(5%). Poverty rates in rural Orissa
Orissa
Orissa , officially Odisha since Nov 2011, is a state of India, located on the east coast of India, by the Bay of Bengal. It is the modern name of the ancient nation of Kalinga, which was invaded by the Maurya Emperor Ashoka in 261 BC. The modern state of Orissa was established on 1 April...
(43%) and rural Bihar
Bihar
Bihar is a state in eastern India. It is the 12th largest state in terms of geographical size at and 3rd largest by population. Almost 58% of Biharis are below the age of 25, which is the highest proportion in India....
(41%) are higher than in the world's poorest countries such as Malawi
Malawi
The Republic of Malawi is a landlocked country in southeast Africa that was formerly known as Nyasaland. It is bordered by Zambia to the northwest, Tanzania to the northeast, and Mozambique on the east, south and west. The country is separated from Tanzania and Mozambique by Lake Malawi. Its size...
.
Since the early 1950s, successive governments have implemented various schemes, under planning
Planned economy
A planned economy is an economic system in which decisions regarding production and investment are embodied in a plan formulated by a central authority, usually by a government agency...
, to alleviate poverty, that have met with partial success. Programmes like Food for work and National Rural Employment Programme have attempted to use the unemployed to generate productive assets and build rural infrastructure. In August 2005, the Indian parliament
Parliament of India
The Parliament of India is the supreme legislative body in India. Founded in 1919, the Parliament alone possesses legislative supremacy and thereby ultimate power over all political bodies in India. The Parliament of India comprises the President and the two Houses, Lok Sabha and Rajya Sabha...
passed the Rural Employment Guarantee Bill, the largest programme of this type, in terms of cost and coverage, which promises 100 days of minimum wage employment to every rural household in 200 of India's 600 districts
Districts of India
A district is an administrative division of an Indian state or territory. Districts are further subdivided, in some cases into Sub-Divisions, and otherwise directly into tehsils or talukas.District officials include:...
. The Indian government is planning to bring in more economic reforms which can help farmers and unskilled labourers transition into industrialized sectors.
| STATE | Total | MALE | FEMALE |
|---|---|---|---|
| Andhra Pradesh | 63.1 | 61.6 | 64.1 |
| Assam | 57.2 | 57.1 | 57.6 |
| Bihar | 60.2 | 60.7 | 58.9 |
| Gujarat | 62.8 | 61.9 | 63.7 |
| Haryana | 64.5 | 64.1 | 65.0 |
| Himachal Pradesh | 65.6 | 65.1 | 65.8 |
| Karnataka | 64.0 | 62.4 | 65.5 |
| Kerala | 73.5 | 70.6 | 76.1 |
| Madhya Pradesh | 56.4 | 56.5 | 56.2 |
| Maharastra | 65.8 | 64.5 | 67.0 |
| Orissa | 57.7 | 57.6 | 57.8 |
| Punjab | 68.1 | 66.9 | 69.1 |
| Rajastan | 60.5 | 59.8 | 60.9 |
| Tamil Nadu | 64.6 | 63.7 | 65.7 |
| Uttar Pradesh | 58.4 | 58.9 | 57.7 |
| West Bengal | 63.4 | 62.8 | 64.3 |
| India | 61.7 | 60.8 | 62.5 |
Physical infrastructure
Infrastructure
Infrastructure is basic physical and organizational structures needed for the operation of a society or enterprise, or the services and facilities necessary for an economy to function...
development. Much of the total outlay was spent on large projects in the area of irrigation, energy, transport, communications and social overheads. Development of infrastructure was completely in the hands of the public sector and was plagued by corruption, bureaucratic inefficiencies, urban-bias and an inability to scale investment.
Calcutta city was the first city in India to boast of a metro-system.Today the calcutta metro is considered among the world's best in terms of service and infrastructure.
India's low spending on power, construction, transportation, telecommunications and real estate
Real estate
In general use, esp. North American, 'real estate' is taken to mean "Property consisting of land and the buildings on it, along with its natural resources such as crops, minerals, or water; immovable property of this nature; an interest vested in this; an item of real property; buildings or...
, at $31 billion or 6% of GDP in 2002 has prevented India from sustaining a growth rate of around 8%. This has prompted the government to partially open up infrastructure to the private sector allowing foreign investment. India holds second position in the world in roadways' construction.
As of 31 December 2005, there were an estimated 835,000 broadband lines in India. Low tele-density is the major hurdle for slow pickup in broadband services. Over 76% of the broadband lines were via DSL and the rest via cable modems.
A 2007 study by the Asian Development Bank showed that in 20 cities the average duration of water supply was only 4.3 hours per day. No city had a continuous water supply. The longest duration of supply was 12 hours per day in Chandigarh
Chandigarh
Chandigarh is a union territory of India that serves as the capital of two states, Haryana and Punjab. The name Chandigarh translates as "The Fort of Chandi". The name is from an ancient temple called Chandi Mandir, devoted to the Hindu goddess Chandi, in the city...
, and the lowest was 9 hours per day in Rajkot.
Regional imbalance
One of the critical problems facing India's economy is the sharp and growing regional variations among India's different states and territories in terms of per capita income, poverty, availability of infrastructure and socio-economic development. For instance, the difference in growth rate between the forward and backward statesStates of India by size of economy
This page lists Indian states and major cities by their nominal gross domestic product . It also displays each state's level of annual GDP growth, as recorded between 1999 and 2007, and the level of growth in GDP per capita, as recorded between 2004 and 2011.-List of states:This is a list of states...
was 0.3% (5.2% & 4.9%) during 1980–81 to 1990–91, but had grown to 3.3% (6.3% & 3.0%) during 1990–91 to 1997–98. Per Capita Income in India varies drastically. As of 2010, New Delhi had a Per Capita Income of $ 3,020 whereas Bihar's Per Capita Income was at a paltry $ 445.
The five-year plans have attempted to reduce regional disparities by encouraging industrial development in the interior regions, but industries still tend to concentrate around urban areas and port cities. Even the industrial townships in the interiors, Bhilai
Bhilai
Bhilai or Bhilai Nagar is a city in the Durg district of Chhattisgarh, in eastern central India. As of 2001, it had a population of 753,837. The city is located west of the capital Raipur, on the main Howrah–Mumbai rail line, and National Highway 6...
for instance, resulted in very little development in the surrounding areas. After liberalisation, the disparities have grown despite the efforts of the union government in reducing them. Part of the reason being that manufacturing and services and not agriculture are the engines of growth. The more advanced states are better placed to benefit from them, with infrastructure like well developed ports, urbanisation and an educated and skilled workforce which attract manufacturing and service sectors. The union and state governments of backward regions are trying to reduce the disparities by offering tax holidays, cheap land, etc., and focusing more on sectors like tourism, which although being geographically and historically determined, can become a source of growth and is faster to develop than other sectors.