On a trip to Singapore a few years ago, a Singaporean jokingly described to me what he called ABCD of Indian problem solving.
He said he's seen some of his Indian friends and colleagues first AVOID the problem, then try and BYPASS it and if that doesn't work, then try and CONFUSE and finally DENY that the problem exists.
The problem we are talking about here is that there is deepening poverty and widening rich-poor gap in India that leaves little room for a genuine middle class to grow, and most Indians on this forum are DENYing this problem.
Now that you are talking about anecdotes, I have one to share with you. Earlier this year, on one of my regular visits while passing thru Dubai on my way to Istanbul, I met an American in the business class lounge on the new terminal for he was also waiting for a connection in to Chicago and I was wasting my time waiting for the EK in to Istanbul.
As would happen with two bored business travellers, we said hello and once he got to know that I am an Indian he was more comfortable and he started talking to me and as always the discussion finally turned to the recession and the recovery and finally the different economies and also fleetingly for a moment to terrorism and economy of Pakistan.
Off the hand he just said that Pakistan's economic policy is nothing by BBS!
I was a little off my feet. ( Like a little toinnnnnggggged)
I mean I had heard of BS but BBS? So I thought probably he just mean to say "Bad BS". But he then thankfully elaborated and I give you his explanation as the following and I quote him:
He said that 1st Pakistan's Government will make lame excuses for all its past economic failures blaming it on all and sundry excuses except on its own elitist and non-revenue oriented policies and BEG for money from the world.
The he said that if that does not work then they will make all promises true or false (VAT implementation?) & BORROW from World Bank / IMF / Fiends of Pakistan etc.
Then finally he said that if nothing works then they will STEAL from any amount whether it is even for humanitarian donations. Like they used 150 Million from WHO provided for polio vaccinations for children to balance the budget last year.
Message: So let us keep the wisecracks out of this and come to the point.
Citing consumption figures such as cars or Internet access means nothing for the middle class in India, the top 5% of Indians (about 55 million) who are rich are doing most of this consuming....and it's being advertised as middle class consumption.
The issue is really simple: Excluding 76% of Indian people below $2 a day (HDR 2009) and excluding the top 5% (as suggested by Birdsall), the population in India that could potentially be candidates for middle class description is reduced to less than 19%, most of whom are closer to $2 a day than $10 a day.
In Pakistan's case, if you exclude 60% poor (below $2 a day) and also exclude top 5% (as suggested by Birdsall), the potential pool for middle class is 35% of the population, almost twice as large as India's 19% for India.
Country Below $2 Top 5% Remainder (potential middle class)
India 76% 5% 19%
Pakistan 60% 5% 35%
Given Pakistan's lower rich-poor gap and higher urbanization than India's, there is a greater likelihood that a larger fraction of Pakistan's 35% belong to the middle class than India's 19%
So let me try to understand your mathematics and deduction abilities and try to create an analogy or example:
You stuff yourself everyday with 1 Kilo of solid food.
You dump eveyday 0.5 Kilos of crap.
So then your weight should increase by 0.5 Kilos everyday !!!!
Cut the BBS Riaz. Bring on the proof of the the "30 - 35 Million Pakistanis earning more than USD 10,000 per year and making a strong middle class".
Do you now know why I quoted the genious Albert Einstien in the last post? Let me repeat it so that you can read it again.
Any fool can know. The point is to understand.
