Title: The Growth and Sectoral Composition of India's Middle Class: Its Impact on the Politics of Economic Liberalization
Abstract: Click to increase image sizeClick to decrease image size Notes I thank Pranab Bardhan for detailed comments, Vijay Joshi for useful conversations, and D. L. Sheth, George Mathew, and Pronab Sen for pointers to data. 1 See, for example, Atul Kohli's argument that the growth of the number of shareholders in India provides a mass base for capitalism, in Kohli, “The Politics of Economic Liberalization in India," World Development Vol. 17, No. 3 (March 1989), pp. 305–28. 2 For example, Erik Olin Wright, Classes (London: Verso, 1985); Frank Bechhofer and Brian Elliott, eds., The Petite Bourgeoisie: Comparative Studies of the Uneasy Stratum (London: Macmillan, 1981); Dale L. Johnson, ed., Class and Social Development: A New Theory of the Middle Class(Newbury Park, CA: Sage, 1982); Dale L. Johnson, ed., Middle Classes in Dependent Countries (Newbury Park, CA: Sage, 1985). 3 Wright, Classes, p. 19. 4 Aijaz Ahmad, “Class, Nation and State: Intermediate Classes in Peripheral Societies,” in Johnson, Class and Social Development, p. 44. 5 Chris Gerry and Chris Birkbeck, “The Petty Commodity Producer in Third World Cities: Petit Bourgeois or ‘Disguised’ Proletarian?” in Bechhofer and Elliott, eds., The Petite Bourgeoisie, pp. 121–54. 6 Satish Deshpande, “The Centrality of the Middle Class,” Contemporary India: A Sociological View (New Delhi: Penguin Books, 2003), pp. 125–50. 7 On these last two points see Zoya Hasan, “Changing Political Orientations of the Middle Classes in India,” in Imtiaz Ahmad and Helmut Reifeld, eds., Middle Class Values in India and Western Europe (New Delhi: Social Science Press, 2002), pp. 152–70; and Suhas Palshikar, “Politics of India's Middle Classes,” in Ahmad and Reifeld, eds., Middle Class Values, pp. 171–93. 8 Pranab Bardhan, The Political Economy of Development in India, 4th ed. (New Delhi: Oxford University Press, 1994), p. 51. 9 Bardhan, Political Economy of Development, p. 51, n. 8. 10 Pranab Bardhan, “The Third Dominant Class,” Economic and Political Weekly, January 21, 1989, pp. 155–56. 11 Pranab Bardhan, “A Political-Economy Perspective on Development,” in Bimal Jalan, ed., The Indian Economy: Problems and Prospects (New Delhi: Penguin Books, 1992), p. 333. 12 Bardhan, “Political-Economy Perspective,” pp. 333–4, and for the quote see Bardhan, “The Third Dominant Class,” p. 156. 13 Kohli, “Politics of Economic Liberalization in India.” 14 E. Sridharan, “Economic Liberalization and India's Political Economy: Towards a Paradigm Synthesis,” Journal of Commonwealth and Comparative Politics Vol. 31, No. 3, (November 1993), pp. 1–31; Vanita Shastri, “The Politics of Economic Liberalization in India,” Contemporary South Asia Vol. 6, No. 1 (March 1997), pp. 27–56; Jorgen Dige Pedersen, “Explaining Economic Liberalization in India: State and Society Perspectives,” World Development Vol. 28, No. 2 (February 2000), pp. 265–82; Arun Shourie, “When Spirit is Willing, Flesh has a Way,” Indian Express, February 4, 2004; Ashutosh Varshney, “Mass Politics or Elite Politics? India's Economic Reforms in Comparative Perspective,” in Jeffrey D. Sachs, Ashutosh Varshney and Nirupam Bajpai, eds., India in the Era of Economic Reforms (New Delhi: Oxford University Press, 1999), 222–260. 15 Andre Beteille, “The Social Character of the Indian Middle Class,” in Ahmad and Reifeld, eds., Middle Class Values, p. 76. 16 For a comparison of the MISH and NSS data with respect to the debate on post-reform decline of poverty, see Deepak Lal, Rakesh Mohan, and I. Natarajan, “Economic Reforms and Poverty Alleviation: A Tale of Two Surveys,” Economic and Political Weekly, March 24, 2001, pp. 1017–28, in which they argue that NSS data in the 1990s is less reliable and greatly overstates poverty. 17 National Council of Applied Economic Research, India Market Demographics Report 2002 (New Delhi: NCAER, 2003), p. 5, for details of coverage and comparability across time of the MISH data. 18 NCAER, India Market Demographics, Chapter 5 and Annex 4, pp. 91–9 19 Computed from Table 4.3, in NCAER, India Market Demographics, p. 22. The distribution of households in the five income classes by household head's occupation is only available for 1999–2000. 20 We assume that female employees are one-sixth of all employees as per organized sector employment data for 1998–99 in Government of India, Ministry of Finance (Economic Division), Economic Survey 2003–-04 (New Delhi: Ministry of Finance, 2004), Table 3.3, p. S-50, and a multiplier of 5.6 persons per household as per NCAER. 21 India Yearbook 2001: Manpower Profile (New Delhi: Institute of Applied Manpower Research, 2002), Table 3.2.20, p. 158. 22 India, Economic Survey 2003–04, Table 3.3, p. S-50. 23 India, Economic Survey 2003–04, Table 3.3, p. S-50. 24 See Table 6 of Government of India, Ministry of Labour (Directorate General of Employment and Training), Census of Central Government Employees, 2003 (New Delhi: Ministry of Labour, 2003), p. 7. 25 Government of India, Ministry of Industry, Public Enterprises Survey 2001–2002 (New Delhi: Ministry of Industry, 2002) Vol. 1, Table 1.28, p. 32; and Public Enterprises Survey 1996–97 (New Delhi: Ministry of Industry, 1997), Vol. 1, Statement 28, p. S-214. 26 I assume the same 28% share for group D in the central quasi government sector other than public enterprises, a 50% share of group D in local bodies, then from Table 5, get 11.459 million non-manual public employees in 1998–99. Further assuming the 17% women employees are evenly distributed among groups A to D, and assuming that each of them is part of a male-headed household, not necessarily in public employment, I get the final figures above. I have relied on informal information from the Institute of Social Sciences, New Delhi, for this assumption, in turn based on the fact that (urban) municipalities, not (rural) panchayats, dominate local bodies and in the former about 60% of employees would be in group D. There is no available breakdown by groups A to D for local bodies; we use an estimate of 50% for group D. 27 For the lowest category of group C employee following the fifth Pay Commission report, at the bottom of the scale of Rs. 3200 basic pay, plus two increments of Rs. 85 by 1998–99, plus 30% house rent allowance, plus city compensatory allowance and traveling allowance, the total emoluments come to Rs. 4,781, or Rs. 57,372, at the very bottom or entry level of the scale. This means that the overwhelming majority of group C public employees, especially if there is more than one earner in a household, joint families being the norm even in urban India as one goes down the income ladder, would be in the 1998–99 MISH-derived definition of broadest middle class. Deflating the roughly estimated 9.5 million non-group D public employee households by a quarter to eliminate female-headed and some additional households to get 7.13 million non-manual public employee-headed households, we get 40 million non-manual public employees. Ministry of Finance, Government of India, Report of the Fifth Central Pay Commission (New Delhi: Ministry of Finance, Government of India), pp. 459–461 and p. 727. 28 India Yearbook 2001: Manpower Profile, Table 3.2.20, p. 158. 29 See Tables 1–4 in Satish Deshpande, “Caste Inequalities in India Today,” Contemporary India, pp. 112–13. 30 D. L. Sheth, “Secularisation of Caste and Making of New Middle Class,” Economic and Political Weekly, August 21–September 3, 1999, pp. 2502–10. For a more detailed account see D. L. Sheth, “Caste and Class: Social Reality and Political Representations,” in V. A. Pai Panandiker and Ashis Nandy, eds., Contemporary India (New Delhi: Tata McGraw Hill, 1999), pp. 337–63. 31 Scheduled Castes (ex-untouchables) and Scheduled Tribes (aboriginal peoples) are groups for whom there have been quotas in public employment and legislative representation in proportion to their population since the Indian constitution was adopted in 1950. Other Backward Classes are caste-defined groups consisting of small farmer and artisan castes for whom there have quotas in public employment since the early 1990s. 32 Yogendra Yadav, Sanjay Kumar, and Oliver Heath, “The BJP's New Social Bloc,” Frontline, November 19, 1999, p. 32. 33 Radhika Desai, “Hindutva's Gujarat: The Image of India's Future,” Slouching Towards Ayodhya (New Delhi: Three Essays Press, 2002), pp. 137–63. 34 Desai, “Hindutva's Gujarat,” p. 146. 35 Sanjay Kumar, “Impact of Economic Reforms on Indian Electorate,” Economic and Political Weekly, April 17, 2004, pp. 1621–30, Table 1 and Table 5. For instances of middle class ambivalence toward liberalization see Baldev Raj Nayar, Globalization and Nationalism: The Changing Balance in India's Economic Policy 1950–2000 (New Delhi: Sage Publications, 2001), pp. 124, 151, 175, 185, 197. 36 Yogendra Yadav, “Urban India More Polarised” and “Economic Reforms in the Mirror of Public Opinion,” The Hindu, June 13, 2004. 37 See, for example, opinion poll, “NDA Shining: 290 Watts”, Outlook, March 15, 2004, pp. 24–25. 38 See David Denoon, “Cycles in Indian Economic Liberalization, 1966–1996,” Comparative Politics Vol. 31, No. 1 (October 1998), pp. 43–60.
Publication Year: 2004
Publication Date: 2004-10-01
Language: en
Type: article
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