Why is India’s middle class so silent about the slowing economy?
Part of the lack of outrage stems from the fact that much of India’s middle class functions as a loyal vote bank for the Modi government.
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India’s economy is slowing. On January 7, the National Statistics Office forecast annual gross domestic product growth of just 6.4% for the financial year ending in March. This would not only be the slowest growth in four years but below the initial projected growth rate of 6.5%-7%. Worse, much of this was driven by a slowdown in manufacturing, further stymieing India’s efforts to employ its massive population.
Is this a cyclical slowdown? A temporary blip driven by short-factors? Investment bank UBS does not think so. It has blamed factors such as slowing foreign investment.
The chief India economist at the investment bank HSBC, Pranjul Bhandari, contended that the high growth India saw till now was simply the economy rebounding after the Covid-19 pandemic. “My sense is the kind of growth numbers we are going to see in the foreseeable future are going to be on average closer to about 6.5%,” she said.
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