Monday, August 16, 2010

Economic Imbalance

Last night I was reading an article on how China overtook Japan in becoming World's second largest economy. As I dug deeper, I was surprised (read it shocked) to learn that India is World's Eleventh largest economy. May be, I need to read my high school social textbooks again! But, can someone here clarify what Economy means and how India happens to be 11th.

Our ranking based on per capita income is 139 out of 192 countries on the World map. Does this say something? According to an estimate by World Bank, one-third of the people below poverty line in the entire world resides in India. Yet, India is also the country with more than One Lakh super rich people. While the number of rich people account for those pretty numbers which puts our country in the top of the world's charts, nothing much seem to change with the Poor. Except for the fact that the poor gets poorer and the rich gets richer.

I was reading the post Economic Independence I wrote 3 years ago on the occasion of Independence day. Nothing much seemed to change!!! I'm afraid to even think that we are failing. Failing of being a democracy, of being an independent country. Are we? I hope not. Can we do something? Wish, we can.

Image Source:

Will the call to our Indian rich people by Bill Gates be answered? Will it begin the end of many sad stories we see around? Will there be any difference in the lives of those kids who beg alms when you stop near traffic signals in your luxury cars, when you dine at costly restaurants, when you take your kids to malls?



  1. That cartoon says it all. Sadly in India, the political system and the total system prevalent in the society is something which makes this economic imbalance more and more strong. One more thing to note is that the IT boom has enabled lot of middle class and lower middle class to go up the economic ladder, but the poor still remains poorer!!

  2. subu - that's a great point. IT sure did help the midsection of the people, but nothing changed with the poor. :(

    Satish - Thanks, dude.

  3. Yeah China becoming number 2 economy was quite shocking. There is this huge divide in the rich and the poor in India, the urban rural divide, the India Bharat divide.

    Good questions asked!


  4. The India Bharat divide! I like it, it conveys the whole thing!

  5. the valley between the rich and poor is the main cause of economic imbalance....BTW great to see that someone still writing on nations concern

  6. that is a cruel reality of the Nation in which v reside...the gap between rich and the poor is ever increasing and should be a point of concern.i think only proper education can elevate the level of poverty in our country.
    the cartoon expresses the post wonderfully!


  7. We can actually become the "largest economy" while we continue carrying a growing proportion of malnourished, impoverished people. If you look at the data, you'll notice that income inequality has risen in india since mid 80s... after the initiation of economic reforms. It simply means that the benefits of economic liberalisation are huge, but are concentrated to the top 5% of the population. The most worrying trend according to me is that the per capita calorie consumption has actually fallen... people are spending on unnecessary things (blame it on consumerism), this is true for low-income groups, and is a very dangerous trend.
    I am glad you have brought up this issue.. the divide in india is just growing....
    Keep writing on such relevant issues.

  8. Magm -
    And in this country its much more, and the divide keeps increasing every passing day.

    Sarah -
    Education is definitely one thing that can save the country from the face of poverty. But, one thing that can quickly change the scenario is the rich giving out the money and balance the economic scenario to some extent. But that is really difficult to happen.

  9. Ruhi -
    That is an enlightening comment. Adding to that, we see all these changing trends without major hand of capitalism in our country. And if that starts happening as well, then the nation will be in much deeper trouble.

  10. very brilliant one. but one out look that I have is capitalism is necessary for best growth. you need wealth first to divide. so wealth creation is necessary in the first place. and best incentive for wealth creation is in capitalism.

  11. The economic divide is far more in China than in India.

  12. Pramod -
    I have second thoughts about capitalism. It is 100% true that capitalism is the best choice to create wealth, but the wealth created in that way is difficult to divide and make it reach the poor. It was proved in many cases at various levels, and we would be another such example if we resort to capitalism to balance the divide. And more over, most of the employment in India is based on small scale factories and micro entrepreneurs. If we resort to capitalism, then we would have one big player taking control of market in a particular segment leading to unemployment of these self employed and small scale people. I am not yet sure what will be the best way to balance the gap.

  13. Hemal -
    China is altogether a different case. I am not sure what exactly happens inside it. But that is an interesting case to discuss. Can you provide more insight into it?


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