Iwell country Where Work cheap, the man who drives the most luxury cars isn’t a billionaire. He’s a parking attendant. With a meager salary, he has to tightly park cars, double and triple park them, and then free them. In India, where auto sales have risen 16% since the start of the Covid-19 pandemic – a trend partly fueled by the growing popularity of hefty sport-utility vehicles – this tricky task becomes even more difficult.
For many, India’s auto boom symbolizes the country’s super-speed economic rise. On February 28, new figures revealed that India’s bip grew 4.4% year-on-year in the last quarter of 2022, up from 6.3% in the previous quarter. Despite the slowdown that IMF expects India to be the fastest growing major economy in 2023, accounting for 15% of global growth. The ruling Bharatiya Janata Party (bjp) believes that the country is right in the middle Amrit Kalan auspicious time that will bring prosperity to all Indians.
Not everyone is convinced bjp‘S boosterism. For skeptics, rising vehicle sales do indeed demonstrate the unsavory imbalance in India’s economic growth. In fact, purchases of two-wheelers such as scooters and motorbikes have stuttered since the Covid hit, down 15% since 2019. These are the vehicles of the masses: half of households own a two-wheeler; less than one in ten owns a car.
Hardly any issue is more central to Indian politics than the well-being of the country’s citizens. The problem is that there is difficulty in answering the question. Official statistics are patchy. Ministers have not released a poverty estimate for more than a decade. Therefore, assessments and inferences using other surveys and datasets, such as B. vehicle sales are made.
These suggest that poverty reduction has stalled and may even have reversed. According to a survey of 44,000 households by the Center for Monitoring Indian Economy (cmie), a research firm, only 6% of India’s poorest households – those earning less than 100,000 rupees (US$1,200) a year – believe their families are better off than a year ago. The recovery from the pandemic, as the economy was hit by harsh lockdowns, has been terribly slow.
The World Bank estimates that closures have plunged 56 million Indians into extreme poverty. Since then, inflation has further eroded purchasing power: real wages in rural areas, where most of the poor live, have stagnated and annual inflation rose to 6.5% in January. Poor families, for whom groceries account for 60% of household expenses, have felt the heaviest pinch. Rural food costs have increased by 28% since 2019; Onion prices up a staggering 51%.
Jobs data also belies India’s impressive growth figures. Participation in a rural employment scheme that guarantees participants low-wage work remains above pre-corona levels. cmie According to surveys, the unemployment rate is also higher, averaging over 7% over the past two years. Many people have given up the search: the labor force participation rate has fallen since the pandemic.
There are many problems with the Indian economy, from poor primary education to an inability to expand the limited manufacturing sector. But these were there even as previous growth spurts lifted millions out of poverty. The recent pain is therefore more a reflection of the aftermath of the pandemic. Urban construction firms, for example, are complaining of labor shortages, as many workers who went to the villages during the lockdown have not yet returned.
These might finally start to relax. The latest data releases suggest that rural wages may be increasing. Deposits in bank accounts set up for the poor are also increasing. The sale of two-wheelers is also slowly gaining momentum. However, much more improvement will be needed for claims from Amrit Kal to sound true ■
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