[TwinBishop]

I think anywhere in the world the following factors matter: 1) your family background, 2) the place where you grew up and did your education, 3) people around you, and above all 4) your luck.

Of course all this in addition to your having a good work ethic, studying well, working hard, having effective habits and so on (which millions have).

And, in India, the caste/community into which you were born also matters. In a way that is also a matter of luck.

Originally Posted by am1m

This is something I think a lot of us don't realize and are losing touch with the fact.
Most of us, certainly almost all of us on this forum (Internet access, typing in English, probably own a car in India) are incredibly lucky and were born with advantages that we didn't really do anything to 'deserve'. Just won the genetic lottery. But I've seen that doesn't make most of us any more considerate to people without those advantages, in fact, it seems to make us go in the opposite way.

Been working with an NGO for the past year. This NGO focuses more on rural students. It has been an eye-opener for me to see how disadvantaged many of them are just because they are not good in English.

Many of us have not made any special efforts to excel in English. We attained fluency because of our background and our constant exposure to the language. The incredible advantage we garner because of this seems unfair at times.

We need to be more considerate of others.

[SmartCat]

Originally Posted by am1m

Just won the genetic lottery.

Warren Buffett famously called it "winning the ovarian lottery."
https://finance.yahoo.com/news/warre...171412689.html

Renowned investor and billionaire Chairman and CEO of Berkshire Hathaway Inc. Warren Buffett often discusses what he calls "the ovarian lottery" — the random chance of being born into a particular time, place and identity.

He told students to imagine being presented with a barrel containing 5.8 billion balls, each representing a different life circumstance. The student would take one ball, and that single chance would determine their place of birth, ethnicity, wealth, gender and intellectual abilities. Buffett encouraged students to think of what kind of world they would design if faced with such uncertainty.

[am1m]

Originally Posted by Samurai

Jumping to the next level is lot easier in India due to free education schemes available for low-income groups, provided they have some guidance and determination.

Originally Posted by V.Narayan

There is a large layer of Indians in the layer below lower middle class and their biggest attribute is to get their children educated and move up to lower middle class and better.

I am so glad to hear this. Anecdotally, I've also been very happy to see instances where people have been empowered to refuse the sort of treatment that used to be considered normal. Recently, an elderly relative of mine was in need of full-time care. Some of us rallied to get things in place and among that included full-time domestic help. I was ashamed to hear some of the conditions that the person being employed was supposed to put up with and I have lost all respect for that relative.

I protested then too of course, but was shut down quickly with 'let the women handle this', 'those are the communist genes you have inherited from that side of the family'. But I was extremely happy when the person employed left the job in a month and left those relatives in the lurch! Of course they are much nicer to the next person who took up the job.

We are still a very class-based society, especially when it comes to dealing with people in blue-collar jobs and domestic help. I'm glad that financial empowerment finally is allowing them more freedom of choice.

[bhairavp]

We employ ~58% of our population in agriculture, which contributes to ~20% of our GDP. The only way out is to:
a) Move the majority of this population into services / manufacturing.
b) Larger landholdings.
c) Better labour laws, ease of land acquisition.

Sadly, due to vested interests, the above will not happen easily. Any government trying to carry out these reforms will instantly be decried as having sold out to the corporates. This so-called demographic dividend is going to come back and bite us hard.

[dodge3p]

Originally Posted by SmartCat

One more dataset (statewise GDP per capita). Look at GDP per capita of Bihar/UP! Among large states, Telengana/Karnataka have one of the highest GDP per capita, probably powered by IT employees.

Does this calculation also factor in NRI remittances? If so I would believe Kerala's per capita would shoot up quite a bit. The state may have a lesser extent of inequality and as it is not too dependent on a single metro city, but parity from evenly (relatively) spread jobs and NRI remittances across the state.

[SmartCat]

Originally Posted by dodge3p

Does this calculation also factor in NRI remittances? If so I would believe Kerala's per capita would shoot up quite a bit.

Kerala's GDP per capita = Kerala's GDP divided by Kerala's population

Since remittances are included in calculation of GDP, it is also included in the calculation of GDP per capita.

25% of Kerala's GDP and GDP per capita comes from remittances
https://www.policycircle.org/opinion...s-from-kerala/

[Fuldagap]

The remittances from abroad even for UP/Bihar would be high if the labourers working abroad start using banking channels to send salaries back home. Alas! Hawala channels are more trustworthy, faster, secure and hassle free for this.

[SmartCat]

Originally Posted by Fuldagap

The remittances from abroad even for UP/Bihar would be high if the labourers working abroad start using banking channels to send salaries back home. Alas! Hawala channels are more trustworthy, faster, secure and hassle free for this.

GDP and hence GDP per capita calculations incorporate all sorts of informal or parallel economy activities, including hawala remittances. That's done by looking at:

- Electricty units consumed
- Sales of consumer goods like soaps, toothpaste, biscuits etc. Basically, all items that you can buy from a grocery store.
- Sales of medicines
- Petrol/diesel sales

and then comparing with previous years.

Above data is easily available since it is maintained by corporates. As people of a state get wealthier, consumption of above also increases, since these are basic goods & services. The numbers are then worked backwards to estimate the size of the informal economy (eg: 40% of overall GDP)

[Fuldagap]

Originally Posted by SmartCat

GDP and hence GDP per capita calculations incorporate all sorts of informal or parallel economy activities, including hawala remittances. That's done by looking at:

- Electricty units consumed
- Sales of consumer goods like soaps, toothpaste, biscuits etc. Basically, all items that you can buy from a grocery store.
- Sales of medicines
- Petrol/diesel sales

and then comparing with previous years.

Above data is easily available since it is maintained by corporates. As people of a state get wealthier, consumption of above also increases, since these are basic goods & services. The numbers are then worked backwards to estimate the size of the informal economy (eg: 40% of overall GDP)

Proxy indicators like some mentioned in your response can help estimate some GDP calculations.
However, it is just an attempt at guessing the size of informal economy/activity or shadow economy estimation.

Hawala is a big headache that adversely affects estimation of GDP. The indirect methods of estimation have severe limitations.

Income-expenditure discrepancies and currency demand methods are used to guess the dent created by informal channels like Hawala. But there is still a huge burden on the calculations.

Adjustments are indeed made to national accounts depending upon how much the government can guess the size of such transactions/activities.

Data accuracy is severely affected and there are major discrepancies that go unreported or hidden.
Hawala is clandestine in nature.

Spending (like electricity bill or buying toothpaste) that happens through the use of money processed through hawala distorts not only the economic policies, tax revenue is also impacted a lot.

Real estate, gold and high value goods are impacted by hawala as the money gets reinvested. Discrepancy between real growth and what is reported, a major, major hurdle.

Hawala functions on trust and doesnt leave behind a record or trail, the true size is hard to quantify. Not only GDP figures but even the confidence in the figures realsed by the government gets affected.

It is likely that the Hawala method is significantly denting the data, but the indirect methods of estimation may be providing some relief to calculations (very limited in the true sense). GDP estimation remains a core issue given the secretive inherent nature of Hawala.

[AseemYadav]

The caste and class divide in India shows no signs of abatement. As long as casteism remains profitable, we Indians are loathe to abandon it. The day caste privilege stops being the golden goose it is, people will drop it like a hot potato. Anecdotal stories of one oppressed caste fellow making it big, does not change the stark reality for 85% Indians. A caste census will leave all lies threadbare. All the more reason that it is opposed tooth and nails by the powers that be.

[parambyte]

It’s very entertaining when I read these kind of forums and people miss out on the very elementary social - economic reasons for poverty (of course one can write gazillions of data, anlytics and 10,000 PHD reports on economy etc) but look around us.

The money that our house helps earn, (cooking maid, cleaning maid, the press/iron wala, drivers, security guards in housing societies, office peons etc), has anyone thought of they can send their children to decent schools and colleges and universities with that income? No hope in hell those people can ever get out of that quagmire of poverty. And when some readers suggest “they can go this this school school, that school, did you send your kids there?

Meanwhile kindergartens, schools, universities, hospitals, houses are becoming prohibitively expensive, thus widening the gap and also erasing the probability of the underprivileged ever to be able to get out of this.

Take an example: My maid has two kids, in Covid most people stopped paying her a salary. Her children’s school went online and she was forced to buy smartphones for her kids with data. She didn’t have enough money to buy two phones so we helped her. But in those Covid years, she couldn’t pay school fees even, because she lost her salaries.

Once schools reopened, they demanded she pay all arrears immediately else kids will not be admitted. Again, we helped her a bit but still she didn’t have enough. So one of the kids had to drop out of school.

(Some people will give examples how absolutely glorious and angelous some Govt schools in their experience are, but I haven’t experienced them yet, those people are welcome to send their kids to those Govt schools).

My office boy’s only child goes to a Govt school. The quality of education sucks. I chatted with the young kid and she has learnt almost nothing. I asked the parents to speak to the school. They say the teachers said “take private tuition”. For a 8 year old? Also can an office boy afford it? When I asked the parents to confront the teachers, they were told “your kid is dumb, no other parents have any complaints”. This is the reason parents don’t complain.

Meanwhile I spoke to an early twenties super privileged kid (parents spending 10s of lakhs in annual education in Masters, she carries a 3.5 lakhs laptop, the latest iPhone, Apple Watch, AirPods, all as a zero income student), can tell you all the ways you can get a credible high, is in first years of masters in Cinema, But can’t tell you what FPS Indian TV uses. She will always do well in life, earn far more salary than any of the children of our help, has even privileged connections to keep her in that economic zone, and produce mediocre work like all else, a salary which lets her buy a nice car with “a tasty 1.5 litre engine”.

Lack of parental education also creates more loopholes of poverty, as someone mentioned here. So many poor parents, who don’t know much, have their kids studying subjects which will never bring enough income home, unless compounded with massive and expensive post graduation degrees, not knowing what else to do. There is no guidance, when parents themselves know no better. Also difficult when parents themselves are struggling to stay alive, struggling to pay rent, standing in long queues for public toilets, struggling for basic nutrition (once my heart broke seeing a family of press-Walas having a dinner of only rice and very watery dal, nothing else), struggling for water which their poverty stricken households don’t get enough of (compared to us 0.1% here discussing which pressure washer to buy to wash our driveways), it’s very difficult. We have made it almost impossible for our poor to rise above their status. And with every passing day we are making it even more difficult.


(Please avoid giving examples of rare outliers who break through : like a lift man whose YouTube channel made him enough money to buy a Tesla (cringes) etc. we are talking of the averages here.)

Will we have two (insert fancy-schmancy brand name here) coffees less every month and increase the wages of our house help by Rs 600/- every month? That money can change her life and those two missing coffees will probably do us a lot of good. No we won’t, we will find reasons not to do that.

Will we use our privilege and money to force our local corporators to improve water and sanitation in areas where our helps live? Of course not. But we will rejoice when those areas are domolished, lives displaced and burdened, to create rich people’s concrete and ecocide granite, calling it “development”, calling it, in true satire, “real”estate, when the actual “real” estate should have been education, humanity, healthcare, culture etc.

Again, examples of NGOs in this space, though nice, don’t mean much. As someone says, we don’t need billionaires philanthropy, we need enduring policies that bring real change to EVERYONE.

The system is rigged in favour of the rich, against the poor.

And thus the cycle continues.

[V.Narayan]

Originally Posted by parambyte

It’s very entertaining when I read these kind of forums and people miss out on the very elementary social - economic reasons for poverty (of course one can write gazillions of data, anlytics and 10,000 PHD reports on economy etc) but look around us.

Dear @parambyte, thank you for your post and your thoughts. Each post enriches this invaluable thread even though often we or some of us may not agree. If anyone were to go through the thousand plus posts on this thread they'd realize that it is very rich in content and depth and most writers are socially responsible people be it towards their domestic staff or others less privileged. A post full of virtue signaling and shaming adds limited value as that boat, at least on this thread, sailed a long while back. My objective is not to criticize you but to just point out that all or most of us contributing here are socially responsible citizens.

Best wishes, V.Narayan

[Chisels121]

The video only focuses on the income part of the Indian population. The 'Sub-Saharan' part is quite stretched to be honest.
Also people who are saying that education was difficult in Bihar in 90's. I am going to just inform that my family is from Bihar and my grandpa was a farmer's son who went to the best engineering college of East India by scholarship in the 60's. . He was certainly not the only guy who had this kind of background in his college. So it all depends on the grit the person has for his/her upliftment.

Today government is giving EWS reservation in colleges and government jobs,free quality coaching for JEE and NEET (this is only in Bihar) decent infrastructure of government schools. Therefore sorry to say but I don't give two hoots about income disparity in India as people are getting freebies from government for that and today if any tells that he couldn't clear am exam because he was poor I would be skeptical about his intelligence.

[nakul0888]

I'll post a simple graph here that aptly highlights the problem with this country.



Vietnam has just 7% of Indian population and its share of global manufacturing exports is higher than India's. I mean have you ever seen something more pathetic than this? I haven't. Even more sadder fact of the matter is manufacturing as a percentage of our economy is going down. We are de industrializing before we have even begun to industrialize. And here we are chest thumping as the next superpower !!!! The next Vishwaguru that leads the way to the entire world!!!! Blah blah blah blah.

The people who comes to sweep and clean our houses, drive our cars as chauffeurs, sells vegetables on carts, toil all day in fields should be at factories working shifts, making enough money to send their children to decent schools to get educated. 99% of us shouldn't be able to afford maids or drivers and we should be cleaning and sweeping our houses on our own, driving our cars on our own because the time of our fellow countrymen should have been so much more valuable to our economy to be doing these unproductive household chores.

And No, they wont have an easy cozy life of professionals like engineers, doctors...etc. Their life will be hard and toiling and the men and women who owns the factories will get rich and wealthier first. No doubt. But this grinding process is what is needed to lift vast majority of our people out of poverty. Giving them a few hundred extra bucks now and again while they are still stuck sweeping your floors or being your personal chauffer isn't going to make any difference whatsoever.

I have come to the sad realization that India will probably never be an industrialized country. Our people including the educated simply lacks the appetite to let happen what's necessary. At the first sight of "inequality" the industry will be stomped on before it even starts. Who is to blame for it? Well, that would be people themselves. Who else is there to blame in a democracy? Who votes for these stupid politicians who have kept India a poor third world country for 77 years and running? The people do. Back and forth between one side and the other. And a good amount of them don't even vote for economy, they vote for nonsense reasons like caste and religion. Sure the cronies do their part to line their own pockets up in between all of that, but ultimate responsibility falls on none other than the common man. He simply doesn't know or care about what is necessary to create a civilized society. That's all there is to it.

[JediKnight]

Originally Posted by nakul0888

Vietnam has just 7% of Indian population and its share of global manufacturing exports is higher than India's. I mean have you ever seen something more pathetic than this? I haven't.

When US imposed restriction on Chinese suppliers, many of these suppliers just shifted out of China to Vietnam to escape US sanctions. Many of these suppliers have actual manufacturing operations in China, just do the final assembly in Vietnam and export out of there.

Originally Posted by nakul0888

The people who comes to sweep and clean our houses, drive our cars as chauffeurs, sells vegetables on carts, toil all day in fields should be at factories working shifts, making enough money to send their children to decent schools to get educated.

It is not as doom and gloom as you point out. Case in point my Dad's driver. He is originally from Benaras now settled in Zirakpur Punjab. When he is not driving my dad around he does random jobs like working for delivery apps. His kids go to a government school in Pachkula. Government provides uniform books and mid day meals. His wife easily makes 50K a month working as maid tax free. That is more money a TCS fresher will see for some time. They never go to a private hospital so are immune to medical inflation. Not to mention they get free ration/gas cylinders. During elections they get paid in cash by all parties. Every adult in his extended family has NREGA card. This list goes on.

I feel these guys actually are better off than so called lower middle class guys. Only thing holding them back is bad habits(this guy will drink till he passes out whenever he gets a chance), non-awareness about how to save and invest money etc.

In India if there is guy who is willing to work to improve his lot, there are lot of opportunities available.