One of the best things about living in India is watching families move from lower or lower-middle class to middle-class status. Usually, all it takes is someone from the family landing a white-collar job.
While the tech bodyshops (TCS, Infosys, etc.) might have a poor reputation in the US, these companies have been absolutely critical in helping move tens of millions into middle-class respectability.
My first job was in Infosys back in 2001. Coming from a lower-middle class farming family, it was a huge deal. My monthly gross was something my dad (farmer) + mom (school teacher) would earn in an entire year. I remember my dad proudly putting a portrait of NR Narayana Murthy (founder of Infosys) on our wall - it is usually reserved for gods/ancestors or revered sages.
My FIL funded their maid’s kids education. The son got into a decent engineering school and landed a job at TCS. The daughter studied nursing and got a job at a large chain hospital. The kids bought their mom an apartment and a car.
Its just amazing to watch - this woman’s mom, grandmom, aunts, uncles were all peasants or did odd trades. Now because of a single generation, the entire family could dream of middle class dignity.
its amazing. and unfortunately they will be the last generation that will be able to do it. just like for western countries everything will become unaffordable and the middle class wont be able to buy houses
Unlikely because there's basically no NIMBY-ism in India. Any developer can just acquire land, some air rights and plop up apartment complexes. And unlike in the US, apartments in India are designed for family life and aren't just for young / unmarried folks.
However, land is the most politically charged investment in India which is controlled by vested and powerful interests once over a certain threshold. It is not that straightforward. Compared to income , houses are very expensive. FSI is very low in India even with Transit oriented development finally becoming popular now. We may not have US style suburbia , however the GINI coefficient or anything similar calculated for per person area availability to live, is going to be significantly skewed.
For example, in Mumbai average people barely find more than few sq ft to live in whereas families like Godrej control land worth approx 10 b $ in the city itself. Moreover the Godrej family do not want the entire land to be used for development per se and are unwilling to part with some of it for developmental infrastructure projects. The moral of the story is that it is the same (if not worse) as any other country.
The rental yield on houses in India can be as low as 2% (source: Personal) which should in theory lead to crash in housing prices, but that is not happening as population in city will constantly increase with rural to urban migration.
Maybe not NIMBYism, but loads and loads of red tape for land acquisition. Especially since all of the land that is not explicitly for non agricultural use is agricultural, and converting it to non agricultural is a whole process usually involving bribes to 20 different officials. See this blog[1] that was posted to HN a while ago[2]
This is not true. Large Indian cities have some of the worst planing/zoning/building codes in Asia. Mumbai's FSI (Floor Space Index) is so bad it's almost a meme.
Maybe. Even so, AFAICT USA and India are vastly different countries though. I wouldn’t take it for granted that India will develop in exactly the same way that USA did.
I'm not sure of your point, but I think I disagree. The previous comment was about going from poverty to middle class. Why won't this be possible in the future?
Right now India is in a transition period and wages for these kinds of jobs are keeping pace with gains in productivity and that's how you're seeing so many lifting themselves are their families out of poverty.
However, if history is anything to go by that will stop pretty soon as the hyper upper class solidifies their hold on wealth, appreciating assets, and means of production, and will start to keep larger and larger shares of profit while workers' wages stagnate, and then inflation will start to decrease the purchasing power of those stagnating wages, and the middle class will start to shrink and disappear as it is in America and other "free market" capitalist countries.
A large majority of the US owns their homes and has been greatly enriched by the distorted housing market. It's a moral hazard resulting from democracy if anything, as people vote themselves into housing monopolies and other advantage over newcomers.
I'm not sure what the "free market" has to do with it. Capitalism, communism, feudalism, socialism, etc.. always end with the majority of money and power concentrated with the few.
I've read that there is a certain number of people that we're basically optimized to coexist within a societal structure, and modern civilization passed that a long time ago, and human beings in general just aren't capable of empathy on the scale of modern civilization. And I mean, it makes sense when you think about it. On some abstract level you have to know that even meagre standards of living in western society requires someone, somewhere to be suffering to provide it. $1 for a pound of bananas shipped from across the world before they even have a hint of yellow on them? That shit don't come without a cost, and our $1 sure as hell aint paying it. But we all just kind of don't think those people just to get through the day, because dwelling on the extent of suffering and horror we've wrought upon our fellow man in pursuit of whatever fresh hell the guys over at Oreo have managed to shape into the general form of a cookie would leave us a broken shell of a person and unable to show up for our next shift at the Big Mac factory.
> Proponents assert that numbers larger than this generally require more restrictive rules, laws, and enforced norms to maintain a stable, cohesive group. It has been proposed to lie between 100 and 250, with a commonly used value of 150.
> this in particular is an emergent phenomena that only happens with large-scale civilizations
Is it? If you have N participants in a market and a bunch of investment opportunities that are on average net negative, the person with the most money will take the most opportunities resulting in their relative worth increasing the most. The endgame for this is one person with all the money. Works for N=2 and N≃infinity.
It doesn't happen in (some? most?) small communities because of specific things that aren't present in big communities.
Oh absolutely agree, everything up until now has eventually descended into the age old pattern of power and money finding it's way concentrated into the hands of the few elite, however capitalism with it's private ownership of the means of production and their operation for profit, and rewarding accumulation of capital, seems like it's designed from the ground up to funnel money and power into the hands of the few, where at at least in theory communism/socialism/other -isms are designed to try to share the wealth.
Of course, said -isms require either an unbroken chain of morally righteous people with absolute power being in charge of said means of production fairly for the equal enrichment of everyone, or some kind of system of checks and balances to keep those in power from abusing it and preventing corruption from outside the political power structures, the exact formula of which we've yet to figure out.
Personally I'm of the opinion we should just throw the baby out with the bathwater and chalk this whole civilization experiment up as a mistake and go back to tribal societies of yestermillennia. Of course, the vast majority of the current human population disagrees with me in that regard and I will admit there are some good things about it, so until that changes I'll be here plugging along like the rest and hoping for better days.
America is not a "free market" capitalist country. I would say it's of the lack of a free market that enabled the wealthiest to capture that wealth that would otherwise have been more evenly distributed. There is an enormous amount of regulation in the US (and other countries) designed to make it nearly impossible to compete with the established actors in the market.
- fungible goods (i.e. stuff like toilet paper where you have 100s of vendors most people can't really differentiate much in terms of end result): good luck with that for any kind of complex good
- perfect information symmetry (i.e. the vendor and the buyer and seller know exactly the same about the product): can't happen when most buyers are individuals and most sellers are companies with full time people employed to work on their products
- low barriers to entry for vendor: good luck, in the real world you need time, capital, experience, etc to enter a market, and even when you're there, there's stuff like brands, marketing, reputation, etc
Etc.
Plus, even if this absurdly perfect model would be achieved, you still have to put stuff like social welfare somewhere in there. Why? Because some people are just plain bad at basic economics (president Truman was close to dying in poverty during his old age), and you can't just let them starve to death.
Nobody thinks a perfect market, or perfect anything is possible. It's just a theoretical concept. None of the imperfections you mentioned can be solved by a state or any other form of coercion.
If India follows the west then it won't be possible for 2 people with education to lift a family out of poverty to middle class. In my country you basically require 2 full-time wages to be able to support a 3 person family. You wouldn't be able to buy an apartment and car for your family.
I don't know what western country you live in, but I'm guessing you have a very different definition of poverty than the article is using. The UN has a list of criteria such as:
- Lacking access to electricity
- Lacking access to drinking water within a 30 minute round-trip walk
- Lacking access to sanitation facilities
- No household members have completed at least 6 years of schooling
- Any child in the household has stunted growth due to malnutrition
You need at least a third of the criteria to be true in order for a household to be considered in poverty.
It's likely that practically no one in your country meets this definition.
During my childhood I fulfilled the first three for about four years or so and knew many others in similar situations. This was in the US, any country with significant undeveloped land is going to have areas that have people who fulfill the first three pretty easily.
Just out of curiosity, how far did you have to walk to fetch water, what was the source, how much did you carry back at a time, and how often did you do this? Sorry for so many questions, but I always think of the U.S. as such a developed country that it's interesting to hear counterexamples.
Every year I lived in a different location but the shortest was a bit more than half an hour trip by bike and I could only safely manage a single gallon. Usually though we'd get water when we hitchhiked into town as we could get more at once. Both of these sources came from water resupply points for trucks but no on cared if you filled a few gallon containers. Rain water was also usable in many cases but we avoided drinking it. We went out maybe once a week or so?
I never said continental, this was on the Big Island in Hawaii. Though I would be shocked if there weren't similar places in the large patches of undeveloped land in the west side of the US.
There are two types of poverty being talked about here.
In the United States (where it is not only possible, but common for two people with education to lift a family out of poverty into the middle class), most people below the poverty have a drastically superior standard of living to anyone below the poverty line in India. The type of "poor" where two people are working full time jobs in the US would not be considered poor in India.
That's because of idiotic zoning laws that make it nearly impossible to build multi family properties, high density residential, limit the height of skyscrapers and basically forced the entire nation to be a damn suburban hell hole, not because of a land shortage. India hopefully won't make the same idiotic mistakes the NIMBY soccer mom boomers did.
That's not really true for India because unlike developed countries, the housing has a wide price range for any given area. Also it is actually preferable to rent in India because rent doesn't even cover half the emi. Overall, through a lot of measures like tax breaks and cheaper loans for housing developers building affordable housing, reduction in interest for low cost housing, free housing for poorer sections of the populace, government has made housing a non issue apart from a select set of cities like Mumbai where geographical constrains ensure higher prices and low availability.
Very interesting. A very basic house in Austria is over 500k and not in a hot location, while to my knowledge wages here are not higher than in Finland. How is a house so cheap in Finland? 200k is basically Eastern/Southern European house prices, where wages are lower.
I feel like the insane housing prices here are not just related to nimbyism that restricts supply, but mostly to speculation driven by banking, political greed, realtors, investors, basically any and all large piles of money that have housing constantly going up fast so that their piles of money get even bigger.
In a rural but well maintained area in France, my parents bought recently an old family house for 80k (to which you have to add some renovation costs). In this area a brand new house with a good amount of land is 200-300k. In my own area, a new house is more along the lines of 500k. In any case those things are highly localized here, I imagine it's true in Austria as well (though the country is much smaller than either Finland or France).
When I see Indian developers, I have in my mind that they're similar to Chinese: the whole village bands together and gather resources to give that one kid a university education and a good job, so that that one kid returns to the village many years later to help people out of poverty.
I have an uncle who came from Malaysia to the US in the 70's to do his studies. He was "given the task by his village elders.." as he would say and they did exactly that pooled resources and made sure he finished school. When I heard his story I was so moved. He's built everyone in his village a house, invested in many businesses now, literally changed lives of countless families and friends.
What a beautiful story. Both how the village came together to help him and how he remembered those elders and their contribution. Both are such rare gifts in a jaded world.
I lived in Indian villages for several decades. I have never seen a single instance of this "village bands together and gather resources to give that one kid a university education".
Of course, people do help each other etc.,
It is different for different cultures but also depends on mobility.
In western world it is currently family but that's because family ties are much more likely to be preserved over time than ties to your village.
In other places in the world people are so immobile that they are expected to be born, grow up, work and die in the same village. And so ties to your local community are much more likely to be preserved over time just like ties to your family. It is not that the village replaces your family, it is just another group of people where it makes sense to invest to get something back in the future. Imagine you had tight knit group of friends where you left school but somehow are still able to stick together. If you trusted that this will continue for a long time it would be much easier to invest within the group knowing somebody might help you out later.
In the 2000s landing a job in Infosys in India was really the equivalent of landing a job in FAANG's. May be even more than that because the era preceding it has such scarcity in terms of opportunity, that it was literally the equivalent of landing a job in some promised land.
If you didn't go into government jobs, where there was lots of bribe income potential. The next best paying jobs were in IT services namely three big IT giants Infosys, Wipro and TCS. It was also a huge social status symbol to get a job in these companies.
Of course many made it big, many didn't. Many realised the same corruption and Indian social practices applied to these companies too. While there was definitely a base upgrade in terms of a salary. The big opportunities, promotions, travel were subject to discrimination, bigotry and corrupt practices plaguing Indian society. And by early 2010's there was total disillusionment with these companies. Many MNCs set up their own shops in Bangalore, where the systems were relatively fair and HR practices, though not perfect did work to some extent. 2010s were all about working in MNCs directly.
Then came the start up era. While some made it really big, start ups in India like everywhere are subject to same lottery set up and also some Indian founders can be stingy with equity, and many turn up to be straight up frauds.
Software jobs did move the needle by a big margin in moving Indians from lower-middle/poor class to middle class.
For anyone that doesn’t know (although admittedly not particularly relevant, but topical) Narayana Murthy is the FIL of the now-current UK Prime Minister, Rishi Sunak.
Imagine marrying into a self-made billionaire Asian family, and feeling overshadowed by your father-in-law. Literally the only way you're getting out from under that is becoming leader of a major country.
Apropos, I've always wondered where the terms gf and bf, for girlfriend and boyfriend, came from, i.e. the West, or India. Wonder, because many such short forms come from or are unique to Indian English.
Your second paragraph raises an interesting and seemingly valid point, but your first paragraph gets me wrong: I did mean the acronym, i.e. gf or bf (and some other such ones; not all, by a long chalk).
Anyway, thanks for giving me the benefit of the doubt. :)
Sure they are common in modern English. (I only speak that version, being modern myself ;) [1]
>Is what you're talking about a bit different? Can you dive in a bit?
Sure I can. Thanks for asking.
Yes, I was talking about something different. But I seem to have been misunderstood by a few people in this subthread.
No worries, it happens. Human languages are not perfect, nor are they always unambiguous. Nor are humans perfect, in writing or interpretation. :)
I wrote the comment casually, so did not think to check how it might be understood differently by others.
When I said
>many such short forms come from or are unique to Indian English.
, I meant, first of all, just "some", because "many" does not necessarily mean "most", let alone "all". It just means "many", for some value of "many". It does not necessarily imply a comparison or relative valuation, such as, "many" relative to the total number of acronyms.
(5000 is a big number on its own, but not compared to 5 million.)
And secondly, I had first come across usage such as gf and bf in emails between Westerners and Indians known to me, some 15-odd years ago, and Indian (techie) English has many :) possibly unique acronyms such as o/p for output, i/p for input, so I thought at the time, that gf and bf might be Indian English acronyms, having not come across them in general Western English usage, at least before that.
[1] An arcane reference to an Asterix comic issue, maybe Asterix in Rome (or Italy), where they talk about learning modern languages such as Latin :)
That's awesome to hear! Our family does something similar - we have a line of portraits above our family photos of the various CEOs that have hired us throughout the years - namely coal and oil company owners.
Those millions who moved to middle class are also helping the layer below them. These lifted households are spending their wealth on house helps, local grocery stores, taxis/autos and a whole lot of other local businesses. This trickle down effect then boosts development in cities where these IT hubs are located. Even more students then want to join these IT companies and enjoy the lifestyle of their seniors thus continuing the cycle.
P.s. We spend money in local shops because the stores like Walmart have still not penetrated the Indian market as they have outside India.
I think in a few years India will find focusing on middle class is not enough. There's finite demand for domestic+outsourceable white collar jobs for 1.4B internal market + ~400M English speakers around the world. PRC has 10s of millions of white collar jobs + 100s of millions of manufacturing that pays better than trickle down housesitting, but there's still 100s of millions more stuck in informal economy while both countries are stuck with another few 100s of millions of subsistent farmers because keeping agriculture low tech is an essential jobs program. Even by PRC standards, India is hyper Deng's "let some get rich first" scheme that's going to cause long term uneven development issues.
Agree completely. We’ve tapped out our services potential. We now need large scale manufacturing. Income inequality and unemployment are very real problems, and its only getting worse. Only manufacturing can create those kind of jobs at scale.
> We’ve tapped out our services potential. We now need large scale manufacturing.
Most "first world" economies are dominated by services, so I would be surprised if India has topped out in services. Do more of the high-level stuff, like design and independent, research and development. "Grunt" work, like churning out code generates, a certain level of wealth. The high-level stuff generates even more. As a crude measure, until India is winning 1.4/7.8 = 18% of Nobel prizes it has untapped potential. (This is not intended as disparagement of India's track record but to highlight the potential for India.)
In my mind the real value of a strong manufacturing industry is that it drives the development of high-level services associated with manufacturing (robotics, materials, science, ...). I'd rather have small highly developed manufacturing sector than a large "low-tech" manufacturing sector.
Most first world economies don't have 1.4B people.
By the government's own admission, 800M people are still being given free food because they can't afford it on their own. That's more than the population of western Europe and USA combined.
Services simply don't employ people in large enough numbers. It's not rocket science - basic maths.
Shrinking globalism has a lot of causes so I don't want to overstate the case here, but one big part of the drive to pull back from it is the PRC's own currency manipulation and leveraging of its manufacturing bottleneck for geostrategic aims. They have themselves to blame partly.
But really, their demographic precipice is what's going to stall them out. I hope their political system is functional enough to let it transition into something that can continue functioning after the end of a turbo-growth economy without collapsing into a Putin-esque kleptocracy or go the way of 20th century Argentina with constant coups and general political chaos.
I would say one of the reason for globalism to retreat is the west (especially US) find itself in a awkward situation: developing world and developed world has to meet somewhere in the middle, which means, the living standard in developed world has to drop.
For developing world to develop, you will have to go the extra miles, you are competing with big guys, trying to make a space for yourself in a crowded room. Every country does currency manipulation, imaging you make your good cheaper to get some papers, only because the paper can be used to buy energy.
> the living standard in developed world has to drop.
That depends on how you define "living standards." For example, the USA can probably afford to lose a LOT of consumer products spending while still raising HDI metrics by simply reallocating how resources are committed. We prioritize spending in a lot of places that don't really return much in the way of physical or spiritual well-being. Think car-dependent infrastructure which mostly just serves to raise need for spending on vehicles and infrastructure. Think fast fashion which mostly serves to accelerate trend cycles so people buy clothes more often than they did otherwise. There's a lot of consumer needs that are socially-pressured here.
What you are saying is absolutely true. The problem is that not everyone is going to think this way. Not having something is easy, but not having something after you had it is hard. The only way to keep the living standard high is actually technology, especially robotics. I am both pessimistic and optimistic on this. I can see a bright future for mankind slaving robotics, but I can also see technology will be guarded as weapons. The same reason in this world we have abundant stuffs and we also have people lacking of basic electricity.
I think a major reason might be that a precondition for globalism has been the US Navy patrolling the high seas and making shipping safe and reliable. As the US retreats from that, the reality will be that many countries cannot guarantee their supply lines. Peter Zeihan talks about this (and many other factors).
The US has been doing this for a long time, but it's gotten to the point where it isn't clear that it is in our interests, e.g., to enable China to be a major trading power.
It makes sense. If the west is worrying about things, it would make sense to build more capacity at home, and then everyone will just follow.
IMO, US's colonization of the world has been through finance, which has been ok for the world. Globalization is a good business for the US, de-globalization will actually accelerate the empires' declining.
India has also hit replacement or below replacement level population in most of the country and it was done without invasively draconian policy setting. Just female literacy and access to healthcare.
Your ideas about population control are antiquated. It is well known that demographic change follows women's rights and economic development, particularly in access to healthcare and education. Draconian laws just lead to wide-scale oppression. India's population (and Africa's) are only growing in the regions that schooling and healthcare infrastructure haven't penetrated yet. The only controls a government can institute under conditions where it can't even run a school are genocidal.
You are not commenting on what I wrote and are using the usual emotional and defeatist rhetoric to oppose any population controls.
Yes, the Chinese approach has been draconian and even cruel. But it has also been effective and the point remains that we should thank them for having succeeded in controlling their population.
I also do think that too little is being done to stop population growth globally because that growth is actually the root cause to most of our environmental issues. Note that between "too little" and your over-the-top claim of "genocide" there a gigantic chasm.
This also applies to Western countries. Many of them have incentives to boost natality. We need to 'free ourselves' from the idea that population growth as a positive and necessary thing because it simply cannot continue and a decrease would even be a net positive for the environment and quality of life.
What part of "The desired outcome already happens in India and Africa through other, more constructive and humanistic methods without any of the ethical downsides" is defeatist? I don't understand the fetish for imposing draconian restrictions on would-be parents in light of those facts.
PRC more insulated against deglobalization than most. Despite trope, PRC is relatively less trade dependant vs OECD/G20 tier countries. It's close to US and JP where internal market is enough to generate growth and development. Meanwhile PRC exports is increasing, especially up value chain in intermediate goods, and among emerging markets. Actual risk of trade disruption with wealthy LIO block is also overstated IMO, first it's ~10% of PRC's GDP. Impact from countries who are serious (so far surprisingly little) about subtantially reducing trade, friendshoring or PRC+1 models are a fraction of that. The really rough patch are US tech blockades that inhibits PRC's ability to upgrade internally, but if overcome, huge boost to development. All of which is to say, PRC exposure to deglobalization is smaller than most think. While reality is PRC so far is inserting herself more and more into global trade despite some efforts to balkanize.
To stay on topic of India (but applies to many countries), PRC / Asian Tiger model of export driven growth model via light industries to generate surplus to upgrade capital is going to be increasingly difficult and expensive. Era of high western consumption (low interest, debt driven etc) and cheap commodities is being tapped out for short/medium term. The TLDR is PRC extracted as much benefit as it can from globalism under relatively ideal conditions while those that did not are going to have a much harder time trying to replicate similar feat. Especially India, because let's be real, west is not going to repeat the PRC "mistake" with India again, especially when India is difficult to geographically contain.
Some cities have “Big Bazaar” which is similar to a Walmart (smaller though, the Indian market doesn’t have the variety of brands and products other countries do). There certainly are a lot of other similar stores. A more American thing that isn't readily available is like a Costco, bulk shopping would be pretty tough there, and people are fine to go out on a more regular basis to pick up fresh milk/veggies.
No American big box retailer will ever be built. Indian government doesn’t allow foreign companies to come in and set up shop very easily (at best they can get in with 49% ownership like Starbucks/Tata). Additionally the logistics situation is very different. Less ports, roads between cities built differently than USA, traffic across states is not a right like USA and various restrictions/inspections/fees can occur. It’s worth keeping an eye on IKEA’s expansion specifically in India. They really want to grow the marketshare, they have the right price points, and people seem to genuinely like and want them around. But lots of artificial hurdles which i suspect are caused by local traders/shops knowing how much business IKEA will take from them.
Indian Amazon is approaching the utility of American Amazon and are pretty good about taking advantage of the existing couriers and air cargo which takes care of some of the interstate logistics I mentioned. The funniest part to me is that every individual item you order comes with it’s own delivery person, there isn’t yet much work to consolidate packages. The current generation is growing up with Amazon though and I anticipate many future improvements.
I also see a dead comment in this thread saying India doesn't have malls... I've never seen more malls in an area than I have in big Indian cities. A lot of them are pretty good!
> The funniest part to me is that every individual item you order comes with it’s own delivery person, there isn’t yet much work to consolidate packages.
I'm impressed how much Aliexpress currently does this: consolidates purchases from different sellers, ship 3rd party to Canada, and then use local postal service for last mile delivery.
We actually have D-Mart and they are quite huge but not comparable to Walmart. These are present at multiple locations in tier-1 cities but are hardly present in tier-2 cities. The thing is even though these are very popular they are not shutting down local shops in the region that they are located. The sheer demand is so high that people get things from local shops instead of standing in long queues at D-mart.
To answer your question, yes Walmart can happen but it has to be ready for some serious competition because other than D-mart other big player JioMart backed by Reliance has entered this space recently.
Yes, there is a company called Dmart and they are doing really well.
Recently one opened in my area and local shop owner mentioned that it is killing their business. People are flocking to Dmart for discounts.
This is how Walmart and other companies spread into things like India - you might even see a few Walmarts open as a "higher class American-like" store, but the vast majority will be in things like Flipkart that are directly aimed at the market.
One of the challenges is real estate and parking. Most major Indian cities are extremely crowded with little in the way of parking space or affordable commercial land. Most large stores in major population areas invariably have to pivot to the higher-end to justify the real estate costs.
Driving out 45 minutes just to buy groceries seems futile since every neighbourhood will have dozens of grocery stores that will deliver right at your doorstep (and now, half a dozen quick delivery apps too).
Not only tech jobs (which certainly have been the biggest factor in lifting tons of lower income to middle/higher income status) but overall due to globalization, lot of jobs have opened up in the past 25 or so years.
I grew up in the 80s and 90s in India and moved to US in 2000. Now I am a US Citizen but when I do go back to visit, I literally know people who were poor/lower middle class and they all are now living upper middle class lifestyles (have a nice car, eat outside a lot , have their own home etc).
Some factors:
- Globalization of economy opening up in the 90s
- Tech and other jobs (manufacturing etc) but more importantly, lot of global companies opening shop after the economy opened up in 90s. It is still not as friendly to outside companies as say China but things are changing even though slowly in a complex country like India
- Rise of Internet especially since the introduction of Jio Data by Reliance. It has changed the game significantly. An average Indian may not have a Computer necessarily BUT they all have data and internet on their phones and almost everyone can order almost anything on their phone including paying for bills (UPI is amazing)
- Mindset of young people is changing especially as more people are now exposed to other countries/culture through TV, youtube/internet, Movies, Travel. Capitalism is becoming more favorable compared to old school thinking of socialism and the whole "Raj" mentality that was left over by British and continued for decades by previous Govts.
There is still a lot of extreme poverty in pure numbers (population size) but I have no doubts that overall, millions have moved from extreme poverty to lower or middle income status in last 2 decades.
Not everything is rosy though. In cities like Bangalore, real estate is super expensive, thanks to software salaries. The same is happening in second, third tier cities now.
But generally speaking, yes, all it takes is one person from a family landing a white collar job. And life becomes (relatively) much better
India’s physical infrastructure has honestly fallen way, way behind our digital infrastructure.
Absurd that I can go a month in India without ever using cash or cards, order everything I want from anywhere and have it delivered within a day (or even minutes), yet it can sometimes take me 45 minutes to travel 3k and that my car’s suspension breaks down at 50k kilometers because there is no public transport and the roads are filled with sinkhole sized potholes.
India's going on a massive metro rail spree and also massively improving intercity rail. Things are significantly improving, though there will always be traffic in a city the size of Delhi or Mumbai.
Eh, that has been ongoing forever. Most projects are grossly delayed and over budget. Not a single metro outside of Delhi has any appreciably large metro rail system. Many have been in development for a decade. Projects get routinely stuck in political gridlock or because the builder went bankrupt.
The Bangalore metro project started in 2011. In over a decade, they've managed a paltry 56km of active rail lines - an average of 5km/year. Meanwhile, the city hasn't even had a master plan since 2016 and every government department works on its own without any collaboration whatsoever (resulting in disasters such as railway stations without any proper bus connectivity).
India's bureaucracy and polity will keep holding our infrastructure hostage.
What car are u using that its suspension broke at 50k, our old family car of 15 years never had once broken, an believe me it was used a lot on Indian village roads.
Real estate will get more expensive due to political greed than any other kind of development. The supply of real estate is artificially constrained by the political class, so any kind of development (say hypothetically manufacturing instead of software) will make it expensive. There used to be a time when new land for building houses was frequently sold by the government in the form of new "colonies", but that has completely stopped. The local political greed (municipal corporators, mayors, MLAs) has destroyed most Indian cities due to lack of planning, and this small fish only cares about short term money they can make.
What you are describing is one part of the problem.
I have friends who earn in dollars. They can easily afford to buy a couple of apartments every year. They do this and let those apartments sit vacant for a few years, waiting for them to appreciate. When many people start doing this, it artificially inflates the prices.
It doesn't work that well in practice. While real estate is overinflated for buying, rental yields reflect the market. They are under 2-4% of the property value in most places.
India is also expanding vertically in cities so new housing is often built in different area and older infrastructure is not maintained in the long run.
A significant portion of real estate is built on under the table money. You often pay 30-50% of the value in black money.
So, real estate is a very illiquid investment unless commercial in India.
There are also cultural reasons for artificially inflating real estate and Indian property developers are under huge loans similar to China. It won't be sustainable.
That can be solved with tax/other laws. Guess who will be most impacted by those laws? Not people with one or two apartments as much, but those who do in large scale - that is again politicians and their helpers who help launder illegal money this way. If there are loopholes in the law, people will abuse it but we have to realize the loopholes are not meant for the layperson but the powerful few who abuse it at much higher scale.
A big reason why Gurgaon real estate is more expensive than Bangalore despite having way more land and poorer jobs is government corruption. All those bribes and backroom deals get siphoned off to buy apartments and land. These buyers can hold forever because their cost basis is practically 0.
I’m actively hunting for an apartment in NCR and get painfully reminded of how poor I actually am.
There was a time when we were living in Delhi and we used to drive down to Jaipur, where our extended family was. We kids looked forward to the drive, as it meant nice stopovers, snacks, etc.
After leaving Delhi we would , after an hour or so, make our first stopover in a little village called .... Gurgaon! There we would have chai, samosas, etc. In those days Gurgaon was separated from Delhi and a sleepy little village.
When the capital expanded, those villagers became instant millionaires.
A lot of comments in this thread are crediting TCS, Infosys, etc for lifting people out of poverty, but another factor was the skyrocketing realestate prices. Small-time farmers who could barely make ends meet suddenly were sitting on million-dollar land holdings.
I visited NCR for first time recently and found that although the metro is amazing, NCR still remains a large urban sprawl whose land potential has not been utilized properly. With continually developing infrastructure on more metro, RRTS etc. hopefully the land utilization also improves.
Not everything is rosy anywhere in the world. One can find issues with any positive story. I would rather have expensive real estate problem due to high paying jobs than poverty.
During my dad's time, it was much easier to buy a house on a modest salary. And the houses were well built too. These days, it is near impossible to buy a house unless you are a very high earner, as all available real estate is being gobbled up by "investors", aka, who have high paying jobs (mostly software).
It is good that we are elevating people from poverty. All I am saying is it creates a different set of problems. But yeah, overall it is good that we are able to pull more people up from poverty.
Just live on rent. It will be far cheaper and flexible in India. The rent won't even pay the EMI for home loans for vast majority of these land lords in metros.
I think the difference is India is a major startup hub that mostly caters to the local market so the effort to shift to more resilient income streams not completely dependent on the global market are underway, something Brazil did not do.
Entirely possible India hits a lean phase and stays stuck where it is. Truth be told, everything from infrastructure to basic law and order are far behind even a “middle income trap” country like Thailand. Too early to pat ourselves on the back.
And recent focus on manufacturing. New govt is heavily pushing local manufacturing(atmanirbhar bharat) for last 8 years. Progress is already being felt in some areas, for example in smartphone manufacturing India went from nothing to #2 in world in those years. They are now targeting more phone phone supply chains like pcb, modems etc. and other consumer electronics too.
To be fair, despite all these efforts, the manufacturing sector has consistently underperformed the rest of the economy. The share of manufacturing as a % of GDP has been trending down for quite a while. Outside of the headline grabbing numbers (such as the iPhone factory), the reality is different.
But Brazil is a really rich country when you consider resources, India is not so, especially when you look at the population size. Only hope for India to maintain momentum is replicating at least 25 % of the Chinese manufacturing success.
I have personally seen this transition. Some folks who started from tier 2 cities got access to white collar jobs because of MNCs like TCS, Infosys.
Now they have improved skillset through Internet courses and are now working on much higher pay at product companies.
MNCs are essentially doing what colleges fail to do in India. Teaching people how to code, talk to clients and bring them into formal employment.
Is TCS/Infosys/etc taking a risk on hiring untrained/undertrained employees and putting in the effort to train them? Or did they get training through a college/university?
If the latter, I’d say education is helping pull these people out of poverty.
IME (I led offshore teams of Indian devs for years), the quality of the in-house training TCS/Infosys/Cognizant/Capgemini etc provide for employees is... poor. They seem to focus on quantity over quality, presumably so devs have lots of "relevant" training to pad CVs with.
I work for one of these services companies in the UK. They put huge investment in having their own training centres and universities and most of the recruits have already attended at least on university. You have to realise that the business is about selling time, not producing working or quality software. The more people you can bill, and the more skills on your CV the better. Once a large enterprise has pushed all their business into outsourcing, they can only go with it and try to make the best of it. Most businesses seem to have done this now, justifying some massive bonuses for their board staff and shareholder gains, due to the perceived "cost savings" going through a professional services business.
Those companies have also aided in increasing the participation of Women in the IT industry and thereby increasing their enrollment into STEM education; India probably has the largest population of women in STEM.
> While the tech bodyshops (TCS, Infosys, etc.) might have a poor reputation in the US, these companies have been absolutely critical in helping move tens of millions into middle-class respectability.
couldn't agree more. In my previous comments, I've criticized bodyshops for their business model but this is so true. While I never worked for any of the WITCH company but I worked with few product based and service based companies, In my case, we do not had our own house, in my 10 years of Software Engineer career, I was able to bought house and also paid my whole housing loan. Own a second hand car. I could also buy a new car but I decided to go ahead with used car instead. For those who don't know, car is necessity in US but in India it is considered a semi-luxury.
Agreed, I would say, I am relatively good at what I do so it also translated in to comparatively higher salary (and still way less than what I could have made if I would have moved to Bengaluru - "Silicon Valley of India")
>While the tech bodyshops (TCS, Infosys, etc.) might have a poor reputation in the US, these companies have been absolutely critical in helping move tens of millions into middle-class respectability
That is more or less, middle classes from developing countries exploded in number. While for the developed countries, their middle class doesnt share the same fortune. The upper class however, reap heavy fortune.
Unfortunately it seems the developed countries' middle class appetite to sustain this is waning.
> While the tech bodyshops (TCS, Infosys, etc.) might have a poor reputation in the US, these companies have been absolutely critical in helping move tens of millions into middle-class respectability.
The same goes for most "slavery" jobs. A lot of people's fortunes has turned all over the world by working under "inhumane" condition for American or European companies.
These are actually good jobs in respect to state of play in these countries. The harm comes from degrading the employment standard in the rich countries where it's impossible to compete with places like China when they work under these conditions and as a result the jobs with "humane" conditions disappear in the wealthy countries or get worse.
Overall though, the world becomes a better places as the people in the developed countries get their stuff for cheap and people in the developing world catch up.
Have to agree. Anyone who has lived in a third world country knows that a formal job is better than a no job, and that many would absolutely love to work for, say, Foxconn for a steady paycheck.
Some of those stories about workers at Foxconn committing suicide also neglect to mention that the factory town has 1M workers who all live and work there, and that the suicide rate is actually lower than that for a city of equivalent size, or that 1M people living together might hurt themselves for any number of reasons (debts, unrequited love, adultery, etc), not just work.
Anti-capitalists and anti-globalists fail to understand that it's impossible to transition from very shitty conditions to good conditions hitting a midpoint of moderately shitty conditions. They just cherrypick examples of bad situations out of context and declare it to be proof of the failings of globalist capitalism without listening to the actual opinions of those they perceive to be victims.
>While the tech bodyshops (TCS, Infosys, etc.) might have a poor reputation in the US, these companies have been absolutely critical in helping move tens of millions into middle-class respectability.
At the cost of Americans dealing with poorer tech support, buggier software (sometimes critical software that leads to million dollar losses), and employment fraud (like lip syncing in interviews where someone else answers the questions connected to the mic).
You make it sound like every employee TCS/Infosys hires are like that. Yes there is fraud and issues with the bodyshops and I am not a shill for these companies but these companies hire tons of Americans as well and create 1000s of jobs in America for Americans. So a blanket statement doesn't add much value.
Thing is it hasn't moved as much as you think. People have moved from poverty to lower middle class not actually middle class. If consider middle class as between 20k to 40k a month and lower middle class at 10k to 20k a month and below 10k as poor then most poor people have only moved to lower middle class only.
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While the tech bodyshops (TCS, Infosys, etc.) might have a poor reputation in the US, these companies have been absolutely critical in helping move tens of millions into middle-class respectability.