Now Reading: Investor says Indian middle class faces existential crisis
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Investor says Indian middle class faces existential crisis
Investor Saurabh Mukherjea argues that the Indian middle class, once a dominant force that shaped policy after independence, now lacks political leverage despite paying the bulk of taxes. In his new book…
Investor Saurabh Mukherjea argues that the Indian middle class, once a dominant force that shaped policy after independence, now lacks political leverage despite paying the bulk of taxes. In his new book Breakpoint: The Crisis of the Middle Class and the Future of Work, co-authored with Nandita Rajhansa and Sapana Bhavsar, Mukherjea points to falling employment, stagnant wages, and rising debt fueled by social media envy as signs of an existential crisis.
The book contends that the government no longer prioritises the needs of white-collar India in areas such as university education, urban infrastructure, and law and order, which it did in the decades after independence. Mukherjea's thesis suggests the middle class is being squeezed from both sides: low growth in earnings and high aspirations driven by online comparisons.
The authors offer no quick fix but frame the crisis as a structural shift that will reshape work and living standards for millions of salaried Indians.
Indian Opinion Analysis
Mukherjea's argument mirrors a longer debate about whether India's tax-to-GDP ratio, at roughly 17%, is low because the middle class bears the direct tax burden while consumption taxes hit the poor harder. The Reserve Bank of India's 2023 household savings data showed net financial savings fell to a five-decade low of 5.1% of GDP, suggesting the squeeze is real. What is missing from the book's thesis is the political counterweight: the middle class votes at higher rates than the poor and has won targeted sops such as income tax rebates and higher standard deductions in recent budgets. The next test will be the full Budget in July, where the government may offer further relief to the salaried class to blunt the narrative of middle-class decline.
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Source: scroll.in
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