A fruit seller pushes his handcart in front of a population clock board displayed outside the International Institute for Population Sciences (IIPS) in Mumbai on April 27. The United Nations said that India, already boasting 1.43 billion people, would this week overtake China to earn the distinction of being home to more humans than any other country on the planet. (Photo: AFP)
India has become the world's most populous nation at a time when its economy is seeing a decline in jobs amid businesses pursuing a job-reducing policy for maximizing profits.
Low-wage jobs, part-time employment, temporary workers, and on-call employees have become the backbone of the Indian economy. They pose no threat to the free run of the neo-liberal market ethos that can show the door to workers at any time without facing any legal challenges.
As a result, the Indian economy has been putting up a good show with significant GDP growth in recent years while household income in the country is getting stagnated amid increased taxes. Food services and even sanitary napkins now come under the Goods and Services Tax.
The rise of de-industrialization, de-unionization, and digital automation are helping low-cost production but they also stagnate or reduce the income of Indian families. Consider tech major Apple, which aims to ship up to 45 percent of iPhones from India and is looking forward to expanding its production in India.
“We’re putting a lot of emphasis on the [Indian] market. There’s a lot that’s been done, from financing options and trade-ins, to make products more affordable and give people more options to buy. There’s a lot going on there," Apple CEO Tim Cook said recently.
“More affordable” means cutting down on production costs by employing fewer hands, paying them less, and increasing the work hours. Production in India could be cheaper by denying fair wages and health benefits to workers, who enjoy almost no labor rights in the new systems of the "developed world."
"The GDP growth and growing Indian economy has become meaningless rhetoric for most Indians"
As the Indian economy, the third largest in Asia and the fastest growing in the world, is putting thrust on jobless growth of the economy, it is becoming almost difficult for it to maintain its middle class — the economically empowered class that drives the nation’s engine of growth. In India, the rich are becoming richer, the poor, poorer, and more middle-class people are slipping down to become poor.
In 2021, India was listed as the fifth-largest economy in the world after the US, China, Japan, and Germany. But while China’s GDP was US$17 trillion, India’s was one-fifth of it at US$3.1 trillion. More importantly, while each Chinese person had an annual income (per capita GDP) of US$12,551, individual Indians had to be satisfied with an annual income of US$2,257.
The GDP growth and growing Indian economy have become meaningless rhetoric for most Indians as studies — such as an Oxfam one released in early April — show that just 5 percent of rich Indians own 60 percent of India’s wealth. The bottom 50 percent of people — some 700 million Indians — share just two percent of the wealth. The GDP growth could mean the rich 5 percent are getting richer.
While India managed about 1.4 percent of the population moving into the middle class per year up to 2016, millions were pushed into poverty in the years that followed. An Oxfam report "Inequality Kills" released in January this year said over 46 million fell into extreme poverty in 2020, while a greater number of Indian billionaires emerged and their wealth surged many-fold.
The young people coming out of India’s elite academic institutions, which are unaffordable to the poor, will take away the comparatively few middle and higher-income jobs available in the country. The huge majority that comes out of Indian universities — each year India produces some 7 million graduates and 4.5 million postgraduates — are either unemployed or take up low-income positions.
Amid the increasing cycle of poverty, the International Monetary Fund expects India to be the fastest-growing economy this year and to account for 15 percent of global growth. The ruling pro-Hindu Bharatiya Janata Party believes India is passing through a period of Amrit Kaal, an auspicious time that will bring prosperity to all Indians.
"India’s population is expected to reach 1.668 billion by 2050 when China’s population decreases to 1.317 billion"
However, the unemployment rate hovered around 8 percent in December 2022, up from about 5 percent five years ago, according to the Centre for Monitoring Indian Economy, a Mumbai-based private firm known for its timely data. The labor force participation rate dwarfed 40 percent of the 900 million Indians of legal age, from 46 percent six years ago.
India has now become home to nearly a fifth of humanity — larger than the entire population of Europe, Africa and the Americas — and half of its population will be under the age of 30. India overtook China as the world’s most populous nation with 1.428 billion people this month.
India’s population is expected to reach 1.668 billion by 2050 when China’s population decreases to 1.317 billion.
The burgeoning population would mean the country needs to produce 90 million new jobs by 2030. But that’s going to be a tall order for India because of the jobless nature and lopsided structural transformation of its economy, which has trapped many job-seekers in precarious employment.
China’s foreign ministry spokesperson said something valuable referring to India becoming the world's most populous country. “I want to tell you that population dividend does not depend on quantity but also quality.”
China knows it better. It lifted most people out of poverty on the planet, under the tutelage of paramount leader Deng Xiaoping way back in the 1980s. It made policy and system changes to ensure that more households have more disposable income and thereby enlarge the domestic market.
India surely needs a few Chinese lessons and an iconoclast economic reformer to bring the achhe din (better times) for all its people. Until India urgently changes its economic policies and systems, the population increase will only mean pushing millions into unimaginably miserable poverty and deprivation.
*The views expressed in this article are those of the author and do not necessarily reflect the official editorial position of UCA News.
