India Insight

India’s rich, richer than the French. Its poor, much poorer

By Reuters Staff
October 7, 2011

By Annie Banerji

As India’s politicians struggle to manage an outcry over the definition of poverty — does earning more than $0.65 a day really mean you are not poor? — a new report shows the country’s rich doing very nicely from fast economic growth.

Rubbing shoulders with Singapore and Hong Kong, India appears in the top five countries where the affluent now have more than $1 million investable assets on average, according to the Global Affluent Investor study conducted by research company TNS.

“India and China have already surpassed major European markets like Germany and France. It’s interesting to see that the entrepreneurial spirit of people in these markets is already paying off in terms of personal wealth,” Reg van Steen, Director of Business and Finance, TNS, said.

But the report points to an important difference between the emerging Asian powers and their Western peers — wealth distribution.

“While 27% of the US are affluent this falls to around 1% in India and China,” the report said. It defined households with more than $100,000 of investable assets as affluent.

It will take some time for the number of rich in India and China to catch up with the U.S. — where the report found 31 million affluent households, 10 times as many as India and China each have.

“It is necessary perhaps to think in a different way, and to see that a country like India, like Schrödinger’s cat, exists in at least two forms simultaneously: rich and poor,” wrote British historian Patrick French.

Poverty looms large over the majority of the 1.2 billion population of the world’s largest democracy, where hundreds of millions continue to live below the bread line.

A couple of weeks ago, the government was hit by a storm of criticism for setting the poverty line at 32 rupees ($0.65) per day. The benchmark — barely enough to buy a return ticket on New Delhi’s subway — is used to gauge who gets subsidies in a country where malnutrition rates in some states are worse than sub-Saharan Africa.

Outcry from the opposition, economists and the media forced the government to say the controversial rate would not be used to decide who has access to welfare programmes.

Two decades of fast growth have brought huge changes to India, but there are growing calls for the boom to be put to better use.

“While economic growth is an important boon for enhancing living conditions, its reach depends greatly on what we do with the fruits of growth,” economist and Nobel Laureate Amartya Sen wrote in an article in February.

Comments
11 comments so far | RSS Comments RSS

There is something seriously wrong with the TNS report.

The report is based on interviews with a mere 12,000 people spread over 24 countries!

There are plenty of more authoritative reports that contradict this report’s findings.

Here is one example:

http://www.europeanbusinessreview.com/?p =2391

http://economictimes.indiatimes.com/news  /international-business/China-to-be-sec ond-richest-country-by-2015-Study/articl eshow/6712806.cms

http://en.wikipedia.org/wiki/Luxury_good s_in_the_People%27s_Republic_of_China

In any case, the claim that China has only 3 million affluent households just don’t add up considering that there are more than 70 million cars on the roads in China. Most of these being imported cars. Beijing alone has more than 3 million cars. And the number is rising fast!

Posted by Peacekeeper101 | Report as abusive
 

One can hardly believe him surveys. For USA, the survey might be true but never for India. In India, as the per the Indian Government, India has 191,963,935 households.
If 1 percent of these households means just 3 million, I pity TNS. Moreover, as the above comment says, the report is just based on the interviews of mere 12,000 people. Till date, not a single exit or opinion poll about India has predicted correctly three times consecutively. For China, the communist government might have special relations with TNT, allows it to collect data freely.

Although the headline could be true. India might have more Rich people that France. Not only France, more than UK. The real question is –

Who has more rich people? China or India. India or China

Posted by abhi1498 | Report as abusive
 

@abhi1498,

Just about all statistics available show China way ahead of India. You just need to visit the 2 countries, and you will notice the huge difference.

*************
In any case:

* As of 2010, China is the 3rd richest nation in the world:

http://economictimes.indiatimes.com/news  /international-business/China-to-be-sec ond-richest-country-by-2015-Study/articl eshow/6712806.cms

* China is also the 2nd largest luxury goods comsumer in the world as of 2010:

http://www.europeanbusinessreview.com/?p =2391

http://en.wikipedia.org/wiki/Luxury_good s_in_the_People%27s_Republic_of_China

Posted by Peacekeeper101 | Report as abusive
 

@ Peacekeeper101
While the number of affluent households in China and India is 3 million each, the U.S. has more than 31 million, the survey shows.

First read the TNS report. The problem is with the study/surveys. Economic survey times talk about the year 2015. Europeanbusiness review doesn’t talk about India. Moreover, how can the surveys be accurate about a communist country like China.

Knowledge doesn’t give you wisdom.

Posted by abhi1498 | Report as abusive
 

@Peacekeeper101
The report is not about the richer country. It is about the number of rich people. The idea of private property is an anathema to a communist country. My question is : Which of these two countries, China and India have more rich people, i.e. more than $100000 in liquid assets. Peace!

Posted by abhi1498 | Report as abusive
 

@abhi1498,

The EconomicTimes report DOES mention China is ALREADY the 3rd richest nation in the world **AS OF 2010** (not 2015).

You need to read the whole article. It states it clearly on paragraph 4.

As for the European Business Review, it doesn’t talk about India because it only lists THE TOP 3 countries in terms of luxury spending. And India is not one of them. The top 3 are Japan, China, followed by the US.

*************

And by the way, the reports I quoted ARE about the people rather than the country. As a country, China IS ALREADY richer than America, being the banker of America and most of the world

Posted by Peacekeeper101 | Report as abusive
 

What an irony? material handling equipments

Posted by Ashok007 | Report as abusive
 

This is the concern which exists in the society and needs to be eliminated from the society as soon as possible.
Best Web Design and Development Company in India

Posted by jacobsmithseo | Report as abusive
 

India and other emerging economies will take their due place in the world arena once economic re balancing sets in to achieve global parity of labor and services worldwide. Along with it these countries will create millions of millionaires and billionaires !
What is more important for the wealthy in India and other nations is to help and support the poor in their respective countries to become financially educated and resist the temptation to exploit the poor for their ignorant mind set! Any poor person can become rich if he changes his mindset to get financially educated! Such a country will be unparalleled in its economic might and there won’t be any poverty in such a world! So get financial education above everything;Govts all over the world should take initiatives to get their citizens financially educated to reduce future dependence on them.

Posted by periellath | Report as abusive
 

As you know most of the communities (Bengali or Tamils) in this sub-continent are infected by ‘Culture of Poverty(hopelessness)’ syndrome, irrespective of class or economic strata, lives in pavement or apartment. Nobody is seriously ashamed of or regret the deep-rooted corruption, decaying general quality of life, worst Politico-Governance, bad work place, weak mother language, filth, continuous consumption of common social space (mental as well as physical, both). Do not ever look for any other positive alternative gesture/values to perform a real way of parenthood – deliberately stop giving birth to any child him/herself till the entire society improves up to the mark, co-parenting children those are born out of extreme poverty, instead. We are becoming parents only by self-procreation – mindlessly, blindfold (supported by some lame excuses), depriving the children’s fundamental rights(of a decent & caring society, fearless & dignified living). We are being driven by the very animal instinct, pushing persons for a nasty living, indulging the entire community to go perish. If the Bengali people ever opt for a freedom from vicious cycle of poverty, need to involve in Production of Space(Henri Lefebvre), form a positive sentiment to overcome the inherent ‘hopeless’ mindset, definite application of human dignity, decent & fair Politics would certainly come up. – Siddhartha B, 16/4, Girish Banerjee Lane, Howrah -711101, India.

Posted by paaji | Report as abusive
 

If USA has 27% affluent people then they also have 99% living on debt. In fact I dont think there is anyone in the US who doesnt live a borrowed life with mortgages, loans, loans and more loans…and thats why USA is in such deep trouble now. There is more “real” wealth in India but in USA most of the wealth is fake and on paper only. India is an old country with a lot of problems but it has stood the tests of time over centuries and is still standing up. USA is a nouveau riche country that has little history to prove its resilience…if so much wealth is created in USA then an eve bigger amount of wealth disappears in the US as well.

Posted by global2014 | Report as abusive
 

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