As India is likely to see a second wave of Covid-19, a report now indicates that the pandemic has reduced the country’s middle-class population by 32 million.
An American nonpartisan think tank – the Pew Research Center – recently released a report based on an analysis of World Bank data, said that China has done much better compared to India despite both countries having similar GDP in 2020.
Soon after the report surfaced, netizens slammed the Narendra Modi government, stating that the situation of the middle class was deteriorating before the pandemic due to poor policies and a failing economy.
What is the Pew Report?
According to the report, Pew Center states that due to the Covid-19 driven economic crisis, the standard of living of people across the world took a hit, with India hit quite badly.
The report states that nearly 75 million people have been pushed to the Below Poverty Line in 2020. When the pandemic induced lockdown was placed, massive layoffs took place leading to several people losing their livelihood and India plunged into a massive recession. The report also points out that while nearly 75% are pushed into poverty in India which also accounts for 60% global increase in poverty.
Pew said that while the gross domestic product (GDP) of India and China were nearly the same in 2020, there was a massive change a year later.
“In January 2020, economic forecasts from the World Bank pointed to virtually the same growth in the real GDP in India (5.8%) and China (5.9%) in 2020. In January 2021, nearly one year into the pandemic, the World Bank revised these growth estimates downward to -9.6% for India but forecast 2% growth for China,” the Pew report said.
Before the Covid-19 pandemic struck, there was anticipation that 99 million people in India would belong in the global middle class in 2020. However, a year later, that number was cut by a third as it is now estimated to be 66 million people. The Pew report also points out that the poverty rate in India likely rose to 9.7% in 2020.
The research agency divides the population in a country into five groups: poor, low income, middle income, upper-middle income, and high income for its analysis.
