Understanding India’s Middle Class Better

 By 2030, India’s middle class is expected to soar to 715 million people, a huge jump from 432 million in 2020-21.

This will shift India’s income demographics – from a pyramid to a diamond shape as more aspirers achieve middle-class status. 

But why should you care?

The future engine of India’s economy 

By 2046-47, 60% of India’s population is expected to belong to the middle-class category, up from 30% in 2020-21. While the absolute income may be higher among the rich, the sheer numerical strength of the middle class makes them the highest savers and spenders in the economy. 

The consumption pattern of the middle class

As incomes rise and the middle class expands, a surge in demand is expected across all categories of consumer goods, driven by the emergence of new consumers. This growth trend will fuel demand for products such as fridges, cars, two-wheelers and air conditioners. 

The trend of premium-isation will continue 

Driven by aspirations, social media, and online shopping, Indians are favouring premium goods and brands. Surprisingly, small towns and tier 3-4 cities are leading the charge, instead of metros where expensive items have found markets traditionally.

Bottomline

As the middle class grows, their appetite for consumption will soar, especially for premium goods and services. Companies catering to these segments are likely to benefit from the growing middle-class trend

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