A recent report by the Asian Development Bank has put numbers to the well-acknowledged trend of Asia?s, and India?s, growing middle class, establishing its size right now, and predicting its growth up to 2050. At present, Asia?s middle class is 525 million strong, and accounts for 23% of global consumption. The report forecasts a blistering 9% growth in Asia?s middle class spending every year through 2030, driven primarily by China, India and Indonesia. Specific to India, the report predicts the middle class population will reach 1.19 billion by 2030 and 1.40 billion by 2050. This, coupled with the growth in China?s middle class (1.12 billion by 2030, 1.24 billion by 2050), effectively puts Asia at the centre of world economic growth in the coming decades. By 2050, the numbers suggest India will be leading this push, with a larger middle class than even China, and a per capita GDP of $41,700. However, it is this number that points towards some of the greatest challenges India will face due to this rising middle class, and rise in overall population. Inequality within India will become a major problem. Using the Gini coefficient, the report says inequality in India was at 32.9 in 1993, and will rise 10% to 36.2 by 2004. This rising trend continues, and will only gather steam in the future. Urbanisation, too, is taking place rapidly. Between now and 2050, the report predicts Asia?s urban population will double from 1.6 billion to 3.1 billion. This, coupled with the rising inequality, will expose its cities to rising trends of crime, drugs and violence.
Apart from these social development issues, the problem of what the report calls the ?middle income trap? is also a major issue. Simply put, this ?trap? is the inability of a middle income country like India to make a shift from resource-driven growth to productivity-driven grown, thus stagnating overall growth rates. In short, all this suggests that there?s lots of work for the government to do in the coming years, in improving urban infrastructure, tackling the problems of inequality and increasing efficiencies in India?s economic infrastructure. The impact on the environment and the demand for natural resources will also create their own set of issues. India?s energy demand in 2007 was 622 million tonnes of oil equivalent (mtoe), and the report predicts this demand to almost quadruple to 2,389 mtoe by 2050. And this is just India; China?s predicted energy demand in 2050 is 11,480 mtoe. Then there?s the demand for water, for land … The new Asian Drama, as it were.
