India’s Middle Class: Estimation, Expansion and Economic Impact

This article explores the estimation of India’s middle class, a key metric for measuring household spending and the state of the economy.

Important discussion points

Lack of a precise definition of the middle class leads to a variety of calculations based on individual assessments of income ranges and consumption standards.

The middle class needs to be significantly expanded in order to fully realise India’s economic potential, despite the effects of the present middle class.

Understanding a Genuine Middle Class

A true middle class has robust and adaptable purchasing patterns that allow it to weather economic downturns without drastically cutting back on consumption.

Implications for investors and the economy: A stable and resilient middle-class demand instills investor confidence, leading to job creation and reinforcing the middle class. Surplus income contributes to overall savings.

Continuous income improvement: A strong foundation for continuous income growth within the middle class drives higher-quality consumption and stimulates diverse and high-quality supply responses.

Features of the Indian Middle Class

Stable income

Higher levels of education and skills

Limited disposable income for discretionary spending

Homeownership aspirations

Access to credit and financing

Affordability of consumer durables and comforts

Prioritization of healthcare and insurance

Emphasis on savings and investments

Associated with upward social mobility

Value placed on education and success

Active civic engagement

Estimating India’s Genuine Middle Class

Discrepancy in popular estimates: Popular estimates tend to overstate the middle class’s size, obscuring the actual extent.

Concentration within the richest deciles: India’s genuine middle class is primarily concentrated within the richest 10 to 20 percent of households rather than uniformly distributed.

Concerns about occupation profiles: Instability characterizes the occupation profiles of the richest deciles, with a reliance on small agricultural land and informal non-agricultural occupations.

Limited upward mobility: Chief wage earners in the richest deciles demonstrate limited potential for upward mobility into higher-skilled occupations.

Issues faced by the Indian Middle Class

Income Stagnation: Many middle-class individuals in India struggle with stagnant income levels, with limited opportunities for significant wage growth or promotions.

Rising Cost of Living: The increasing cost of essential goods and services, including housing, education, healthcare, and transportation, often outpaces income growth, putting financial strain on the middle class.

Inflationary Pressures: Inflation rates impact the purchasing power of the middle class, making it challenging to maintain their standard of living and meet their financial obligations.

Job Insecurity: Middle-class individuals face concerns about job security, as economic uncertainties and technological advancements lead to changes in job markets and potential layoffs.

Healthcare Expenses: Rising healthcare costs and limited access to quality healthcare put a significant burden on the middle class, impacting their financial well-being and ability to seek necessary medical care.

Global Slavery Index: Controversies with modern Metric

Report released: The worldwide slavery index, which was released last week, gives an overview of modern slavery.

50 million people are slaves today: According to the estimate, 50 million people were reportedly subject to “modern slavery” at any given time in 2021.

current slavery Of the 50 million people who are impacted, 28 million are subjected to forced labour, and 22 million are coerced into forced unions. Surprisingly, 12 million of those who are affected are kids.

What Is Modern Slavery?

“Modern slavery” refers to situations in which people are exploited and are unable to refuse or leave because of threats, violence, compulsion, fraud, or abuses of authority.

Broad range of abuses: Modern slavery is an umbrella term that covers various forms of exploitation, including forced labor, forced marriage, debt bondage, sexual exploitation, human trafficking, slavery-like practices, forced or servile marriage, and the sale and exploitation of children.

What is Global Slavery Index?

Constructed by Walk Free: The Index is created by Walk Free, a human rights organization.

Based on Global Estimates of Modern Slavery: The index relies on data provided by the Global Estimates of Modern Slavery, which is produced by the International Labour Organization (ILO), Walk Free, and the International Organization for Migration (IOM).

Fifth edition: The recently published Global Slavery Index is the fifth edition and is based on the estimates from 2022.

Country-wise estimates: While initial estimates are regional, the index employs representative surveys to determine country-specific estimates.

Metrics: The index examines the prevalence of modern slavery by calculating the incidence per 1000 population.

Country-wise Findings

Highest prevalence of modern slavery: The following ten countries have the highest prevalence: North Korea, Eritrea, Mauritania, Saudi Arabia, Turkey, Tajikistan, United Arab Emirates, Russia, Afghanistan, and Kuwait.

Countries with lowest prevalence: Switzerland, Norway, Germany, Netherlands, Sweden, Denmark, Belgium, Ireland, Japan, and Finland have the lowest prevalence of modern slavery.

Countries hosting the most people in modern slavery: The top ten countries are India, China, North Korea, Pakistan, Russia, Indonesia, Nigeria, Turkey, Bangladesh, and the United States.

Criticisms of the Index

Lack of internationally agreed definition: One criticism is the absence of a universally accepted definition for modern slavery, unlike trafficking in persons which has an agreed-upon definition.

Calculation based on “risk score”: Factors determining the risk often align with those used to classify countries as developed or developing, potentially leading to biased conclusions.

Discrepancies in statistics: For instance, the index highlights the UK as having the “strongest government response to modern slavery,” but later mentions a decline in the UK’s overall response and potential violation of international law.

Achieving Self-Reliance in Fertilizers: A Stepping Stone Towards Atmanirbhar Bharat

Prime Minister Narendra Modi made the firm proclamation, “When the world is in crisis, we must pledge, a pledge that is greater than the crisis itself.” in the wake of international problems. The road to attaining this is self-reliance, as demonstrated in the government’s unrelenting pursuit of an independent India through the Atmanirbhar Bharat projects. We must work to create the 21st century India’s century.

Fertiliser industry advancements and successes during the past four years

Increased opening stocks: The opening stocks of important fertilisers, including DAP (Di-Ammonium Phosphate), MOP (Muriate of Potash), and other NPK (nitrogen, phosphorus, and potassium) fertilisers, have significantly improved.

Self-reliance in fertilizer production: The government’s efforts towards achieving self-reliance in the fertilizer sector have yielded positive results. Through measures such as long-term agreements, joint ventures, and diversification of suppliers, India has reduced its dependence on imports and strengthened its domestic fertilizer production capabilities.

Enhanced fertilizer supply chain: The Department of Fertilizers has positioned India as a key player in the global fertilizer supply chain. Through strategic partnerships, long-term agreements, and joint ventures with various countries, India has secured a consistent supply of fertilizers.

Resource partnerships: The government partnerships include countries such as Jordan, Saudi Arabia, Oman, Canada, Russia, Morocco, Israel, Senegal, Tunisia, and South Africa. Such collaborations have provided India with access to critical raw materials like rock phosphate and phosphoric acid, strengthening the country’s resource security.

Product portfolio diversification: The expansion of NPK complexes, promotion of alternative fertilizers, and the introduction of innovative formulations have provided farmers with more choices to meet their specific crop and soil requirements.

Fertilizer industry growth and employment opportunities: The government’s initiatives and investments in the fertilizer sector have contributed to the growth of the industry. The establishment of joint ventures, expansion of domestic operations, and technological advancements have created employment opportunities and fostered economic development in the sector.

Commitment to food security: The government’s efforts towards achieving self-reliance in fertilizers align with its commitment to ensuring food security for the citizens of India. By strengthening the fertilizer supply chain, diversifying the product portfolio, and enhancing domestic production capabilities, the government is taking proactive steps to meet the fertilization needs of the agricultural sector.

Steps for Securing Fertilizer Supplies

Long-term agreements: The government has encouraged domestic industries and public sector undertakings to sign long-term agreements for the import of raw materials and intermediates such as ammonia, phosphoric acid, and sulfur.

Joint ventures: The government has promoted the establishment of joint ventures with resource-rich nations to secure fertilizer supplies. Joint venture plants have been set up in countries like Jordan, Saudi Arabia, Oman, Canada, Russia, Morocco, Israel, Senegal, Tunisia, and South Africa.

Strategic partnerships: By collaborating with resource-rich nations, the government has established a reliable channel for procuring raw materials. These partnerships have allowed India to secure a supply of 157 LMT of various fertilizers for three years and 32 LMT for four years.

Diversification of suppliers: By expanding the list of countries from which fertilizers are imported, India reduces its dependence on any single nation. This diversification enhances the stability and security of the fertilizer supply chain.

Foresightedness in crisis: Despite facing challenges such as scarcity of raw materials, including gas, oil, rock phosphate, and potash, the government managed to forge long-term agreements and joint ventures to ensure uninterrupted access to fertilizers.

Strengthening domestic operations: The government has supported the domestic industry in identifying opportunities across the value chain. By strengthening domestic operations, India reduces its reliance on imports and becomes more self-sufficient in fertilizer production.

Promotion of alternate fertilizers and natural farming: In addition to securing traditional fertilizers, the government has also focused on promoting alternate fertilizers and natural farming practices. This not only reduces dependence on imported fertilizers but also encourages sustainable and eco-friendly farming methods.

CoWIN Vaccination Data Breached

Reports of a data breach involving recipients of the COVID vaccine were disputed on Monday by the Health Ministry, which claimed that the assertions were unfounded and malicious.

The Indian Computer Emergency Response Team (CERT-In) has been tasked with conducting an investigation into the claimed data breach issue and submitting a report to ascertain the details.

Data security assurance: According to the Ministry, the CoWIN (Covid Vaccine Intelligence Network) portal is totally secure and has all the necessary security measures in place to protect personal information.

About CoWIN

Development: The Ministry of Health developed, owns, and manages CoWIN.

Policy decisions: The Empowered Group on Vaccine Administration (EGVAC), chaired by the former CEO of the National Health Authority, oversees this. It includes members from the Health Ministry and MeitY (Ministry of Electronics and Information Technology).

Evaluation of Alleged Breach

CERT-In review results: The review conducted by CERT-In concludes that there was no direct breach of the CoWIN app or database.

Data source of Telegram bot: The data accessed by the Telegram bot was sourced from a separate threat actor database, which contained previously breached or stolen data.

No direct breach of CoWIN: The Ministry states that it does not appear that the CoWIN app or database itself was directly breached.

Clarification on CoWIN Data Access

Three methods of data access: The Ministry outlines the three ways in which data can be accessed on the CoWIN portal: user access, vaccinator access, and authorized third-party applications.

Data sharing with Telegram bot: The Ministry clarifies that data cannot be shared with the Telegram bot without undergoing the one-time password (OTP) authentication process.

Limited data collection: CoWIN only collects the year of birth and does not capture a person’s address.

Unanswered Questions and API Access

Uncertainty regarding recent breaches: The Ministry has not explicitly clarified whether the CoWIN database was breached recently or in the past.

Lack of insights on bot accuracy: The Ministry’s statement does not offer insight into the accuracy of the Telegram bot’s retrieval of citizens’ data from the CoWIN database.

API access without OTP: The Ministry admits the existence of an API that allows data sharing without OTP, but emphasizes that requests are accepted only from trusted whitelisted APIs.

Concerns and Aadhaar Data

Accuracy of Aadhaar details: The accuracy of displaying Aadhaar numbers corresponding to mobile numbers raises concerns, as the government has never publicly acknowledged any breaches of Aadhaar data.

Need for clarity: The Ministry’s statement does not provide clarity on how the Telegram bot accurately displayed Aadhaar numbers.

Addressing security concerns: The Ministry should address concerns regarding the security of Aadhaar data and provide transparency on its safety measures.

Future Steps and Data Governance Policy

Empowering CERT-In: The Health Ministry has requested a final report from CERT-In to investigate the alleged data breach incident thoroughly.

National Data Governance policy: The Ministry highlights the finalization of the National Data Governance policy, which aims to establish a common framework for data storage, access, and security standards across the government.

Awaited response from CERT-In: The Ministry is awaiting a response from CERT-In regarding the issue, which will provide further insights into the nature of the breach.

Assurance and Previous Leaks

Assurances of secure infrastructure: Health authorities maintain that CoWIN has state-of-the-art secure infrastructure and has never experienced a security breach.

Dismissal of previous claims: Previous claims of data leaks, such as the ‘Dark Leak Market’ incident, were dismissed by health authorities, emphasizing the safety of citizen data.

Security measures in place: CoWIN has implemented security measures such as web application firewall, regular vulnerability assessments, and OTP authentication to ensure the protection of data.

Implications of this data leak

Identity theft risks: The leaked data exposes individuals to the risk of identity theft, as sensitive information can be misused for fraudulent activities.

Targeted scams and phishing attacks: With access to personal details, scammers may attempt targeted scams and phishing attacks, leading to financial loss and potential harm to individuals.

Loss of trust in government systems: The data breach undermines public trust in the government’s ability to safeguard sensitive information, affecting confidence in the vaccination program and other government initiatives.

Reputational damage: The incident could tarnish the reputation of the CoWIN platform and associated government agencies, affecting their credibility in managing sensitive data.

Impact on future vaccination drive: Concerns about data security may deter individuals from participating in the vaccination program, slowing down efforts to control the spread of COVID-19.

Calls for accountability: The data leak prompts demands for accountability from the responsible government agencies and the implementation of stricter measures to protect citizen data.