Coronavirus | According to the Pumik study, the epidemic may double poverty in India

According to an analysis by the Pew Research Center, India’s middle class has fallen to the third place due to the 2020 pandemic-induced recession, while the number of poor people – less than 150 – per day – is earning more than double. In comparison, Chinese incomes remained relatively low, with the middle class population declining by just 2%.

The report, released on Thursday, uses the World Bank estimates of economic development to estimate the impact of COVID-19 on Indian income. The lockdown arising from the epidemic resulted in closed trade, loss of jobs and declining incomes, which plunged the Indian economy into a deep recession. The report noted that China managed to avoid a contraction, although growth slowed.

“The middle class in India is projected to shrink to 32 million in 2020 as a result of the recession, this number could reach an absent epidemic,” the report said, adding that the middle class had almost no income. Defining people as having 700–1,500 or $ 10–20 per day.

“Meanwhile, the number of poor people (with incomes of $ 2 or less) in India has increased by 7.5 crores due to the COVID-19 recession. This report accounts for about 60% of the global increase in poverty, ”the report said, adding that an estimated 60 million to 134 million poor people are expected to grow. This noted the record spike in MGNREGA participants as evidence that the poor were struggling to find work.

Also read: UN says COVID-19 can promote conflict, poverty, starvation

Majority of the population of India falls in the lower income group, earning around 150 to 700 population per day. Pew estimates show that the group declined from 119.7 crore per day to 116.2 crore and fell below the poverty line by about 3.5 crore.

The middle income group is likely to come down from around 10 crores to just 6.6 crores, while the affluent population which earns more than ₹ 1,500 per day has also fallen by about 30% to 1.8 crores people.

In contrast, China’s middle class is likely to suffer only one crore mining losses, while the number of poor people may be as high as 1 million, according to the report.

Pew warned that the situation may actually be worse than anticipated. “The methodology in this analysis assumes that income changes at the same rate for all people,” it explained. “If the COVID-19 recession has worsened inequality, the increase in the number of poor is likely to be higher than anticipated in this analysis, and the decrease in high-income numbers is likely to be less than anticipated. The middle class may shrink more than anticipated.