Opinion A monsoon awakening

For the Indian middle class,Gandhi — the original — is not someone they easily identify with except in an attempt to claim an enlightened legacy. The Ramlila Gandhi may have been a rallying point but not the main motivation. Corruption,at one level,is an issue that has been partly fuelled by the middle class; their growing affluence gave them the resources to afford short-cuts to special services and privileges. For most of them,it was a small but necessary price to pay,indeed,almost a status symbol to flaunt hard-to-get products and services. So what really brought them out onto the streets in such surprisingly large numbers?

Here’s a theory worth considering: Life has suddenly become very insecure for the middle classes,from professionals to entrepreneurs,who have been the main beneficiaries of economic liberalisation over the last 20 years. The economic slowdown is real,and hits where it hurts: their pockets. Incomes have stayed static or barely risen for most salaried professionals,and so too for entrepreneurs in key sectors of the economy — mainly export-oriented — during the post-2008 period. And with the global recession carrying on its relentless slide,the future looks decidedly scary. Job security,in many export-focussed sectors focused — from manufacturing to IT and BPOs,from steel to autos and gems and jewellery — has become an area of serious concern. For the middle-class professional,it’s a dramatic change from the boom years when the sky looked the only limit.

Here’s the clincher: Prices have shot up across the board simultaneously. Inflation has climbed steadily over the past 20 months,eating into incomes and savings. Structural food price issues and strong demand pressures have pushed inflation in India well above the norm for Asia,according to Richard Iley,the chief economist for Asia at BNP Paribas. Food accounts for about a quarter of the Wholesale Price Index,and the fact that the average food inflation rate in the last four years has been close to 9 per cent (last decade it was around 4-5 per cent),has had a huge impact on middle-class lifestyles,expenditure and savings.

There has been a sharp and parallel price rise in other areas of middle-class consumption,from petrol and diesel to LPG to other consumer items. Fuel prices alone have risen 400 per cent in the last decade. The ones who have been hardest hit by wage deflation and high inflation have been salaried professionals. All this,coupled with no real visible push to the economy or attempts by the government to rein in prices has added to middle-class anger. The irony is that it’s now directed at the man who they admired the most for being the architect of India’s reforms,and its remarkable GDP growth rate: Manmohan Singh.

There is a clear connection between the dramatic curbing of lifestyles and ambitions through rising prices and dips in earnings to growing insecurity and coming out on the streets in anger at the threat to the Great Middle Class Dream. The anger is directed at the government headed by Manmohan Singh for letting them down after giving them so much hope.

It symbolised the breaking of an implicit contract between the middle class and the UPA government under Manmohan: allow us to rule and we’ll make you rich. When functional turned dysfunctional in UPA 2,and the middle class dream died,the relationship died with it.

India’s middle class will account for almost 40 per cent of the country’s population in 15 years,according to a projection from the National Council for Applied Economic Research. They are now poised to be agents of change. Across the world,it’s the middle class that is the driving force behind growth and prosperity. It should be no surprise that the Indian bourgeoise now want a bigger say in the future of their country now that their own future is coming under threat. The poor have always faced that prospect,and the rich can rise above it; it’s the rest that are,literally,trapped in the middle.

Unlike the Arab Spring,it is not an emotional call for democracy or a new government or even an instant-noodle end to corruption. It is instead,the stirrings of a deeper change in the middle-class psyche and its tolerance for what they see as an arrogant and unresponsive leadership. The lifestyle revolution they experienced in the past two decades gave the false hope that they could expect a higher quality of governance,a tide of rising expectation which is now threatened.

The final straw has been that they imagine their money,as taxpayers,is either being wasted due to corruption or invested in grandiose but revenue-draining schemes for the poor,and no longer invested in infrastructure and growth-oriented reforms. The new middle class has also realised that,at 200 million and growing fast,their votes and opinions can no longer be taken for granted. Their taking to the streets may have been spontaneous and inspired by a single event,but it represents a social and political churning of considerable import.

The tipping point has been reached and a contract has been broken. They now want a bigger say in seeing their hard-earned money being put to better use,even if means getting down and dirty.

dilip.bobb@expressindia.com