COVID crisis: Job losses pushed millions into poverty, 32 million Indians out of middle class, says research

The 2020 pandemic brought with it huge financial challenges and pushed approx. 32 million Indians out of the middle class, the US-based Pew Research Centre said on Friday. The job losses due to lockdown in the wake of coronavirus pushed millions into poverty.

The number of Indians in the middle class, or those earning between $10 and $20 (Rs700- Rs1,400) a day, shrunk by about 32 million, compared with the number that could have been reached in the absence of a pandemic, the report stated.

A year into the pandemic, the numbers of those in the middle class has shrunk to 66 million, down a third from a pre-pandemic estimate of 99 million, it added.

Quoting the World Bank's forecasts of economic growth, the Pew Research Centre said, "India is estimated to have seen a greater decrease in the middle class and a much sharper rise in poverty than China in the COVID-19 downturn."

Between 2011 and 2019, the living standard of nearly 57 million people had improved and thy had joined the middle income group , the report further added.

The World Bank, last year in January had predicted almost the same level of economic growth for India and China, at 5.8 per cent and 5.9 per cent respectively, in 2020. But after a year into the COVID epidemic, the World Bank issued revised forecast this January stating contraction of 9.6 per cent for India and growth of 2 per cent for China.

In China, however, the fall in living standards was modest as numbers in the middle-income category probably decreased by 10 million, while poverty levels remained unchanged, the report added.

The Pew Centre has evaluated the number of poor people, with incomes of $2 or less each day (around Rs145), has gone up by 75 million as the recession brought by the virus has severely affected the years of progress.

A nearly 10% increase in fuel prices, unemployment, job losses, and salary cuts along with other pandemic induced financial issues have created serious problems for many Indian households, forcing many people to see jobs overseas.

At present, India is facing a second wave of infections in some states, after a decline in cases until early this year, and its tally of 11.47 million is the highest after the United States and Brazil, in spite of the vaccination drive that has fully inoculated approx. 6.91 million people.

Reacting on this report several netizens expressed their anger and disappointment and called it the failure and mismanagement of the current government. Here is a collection of some of the responses: