 You're watching News Made Easy and I'm on India Chakravarthy. Friends, there's going to be another economic boom that's going to come very soon. You're going to hear about it, but it's only going to be for the top 1-2% of Indians. The rest of India is going to continue to face the economic hardships that they've been facing for a very, very long time. Now, who are these 1-2% of people? Many of you who are watching this video are likely to be amongst them. Because if you're household income, and household I mean that it includes probably 2 people, on an average 1.25 people per household when we talk about working, earning members in every family. And if your household income is about 10 lakh rupees or more, then you are considered to be an affluent person in India. That's what most economists take as the threshold. That's about 83,000 rupees. Most of these such people who earn that kind of money stay in big cities in India. And they stay in the better of localities in these cities itself. Not necessarily the poshest or the tiniest places, because after all with about 80,000, 80, 85,000 rupees a month, it's very unlikely that you're going to be living in the richest part of your city, given the EMI is required for that or the rents required for that. But if you have 2 kids, you're probably sending them to the good private schools of the city, paying 6-7,000 rupees per month on their education. You go for occasional lunches and dinners to mid-rump restaurants. And if you earn more than that, obviously to top-rump restaurants, you probably have got that car and you're probably going to be replacing it every 6-7 years. You have smartphones, more than one in the family. You have laptops and desktops in the family. You subscribe to English newspapers. You probably have Netflix and Prime Video that you watch, even Hotstar. And you generally also spend on household gadgets, because these are the people, those who earn more than 10 lakhs a year. These are the buying classes of India. These are the people who do almost all of big ticket purchases in India. Alright, let's try and gauge how many people there are who earn more than 10 lakh rupees a year. A year, remind you, not month. If I do a bit of number crunching on the income tax data for 2017-18, which is un-money earned in 2017-18 and tax paid, which is also called the assessment year of 2018-19, then you will see that there were about 5 million odd families, households. And this requires a bit of number crunching and assumptions. But I'd say roughly about 5 million households who earned more than 10 lakh rupees a year. These are tax-paying households and because of various kind of stringent actions, one really can't expect that tax is not being paid by the visibly affluent. So this would more or less be the correct number. Mahesh Vyas of CMI wrote recently that now in 2021, there are just about 3 million such households left who earn more than 10 lakh rupees a month. And he says that before that, before the pandemic hit us, which is March 2021, in 2020, there were about 4 million. So during COVID, about 1 million or 10 lakh affluent families slipped below the threshold. And between 2018 and 2020, before that, because of the slowdown, pre-COVID slowdown, another million had slipped through as well. So effectively, currently, there are about 3 million odd families who can buy, who can really buy goods. And they are the people who drive it. So that 5 to 3 million slide, that is what has shown up as despondency. That is what has shown up as the slowdown that you see, cars not selling, gadgets not selling, houses not selling, even hospitality businesses in trouble. So that is what had caused the affluent had slipped. A significant section of the affluent had slipped below that threshold and won't be spending that much anymore. But how much does it really take for that recovery to take place? Very little. All you need is about broadly 400 to 500,000 jobs. 400 to 500,000 job openings where people have a sense that, we can go to another job and earn more. As soon as that happens, there will be a sense of recovery that takes place. Amongst this top 1%, remember, 3 million households is just 1%, less than 1% of India's population, 5 million households is less than 2% of India's population. So that is all that the recovery is going to affect, that top 2%. And it doesn't make take much. And already there are surveys that tell us that nearly 3 lakh new jobs, open positions exist in white collar jobs. Right now in September, they're better paying. We're hearing of how IT salaries, you know, tech salaries have shot up sharply. And that is going to show up in increased consumption. And you're going to say how much can that happen? But it has happened. All the booms that we've seen since liberalization has actually been driven just by that top 2% to 3% of people, not more than that. That is why in India, we sell about 2.7 million cars a year at peak, 2.7, 2.8 million cars a year. When it's at its peak, it tells you that other than the replacement demand, there is very little new demand for goods in India, except for replacement and upgrade. That is all, that top 1% to 2%. Yes, there is a demonstration effect. There is a multiplier effect that probably trickles down to another 8-9% of people. It's just that top 10% who are consuming in this country. 90% of people do not consume. When that top 2% drops a little bit, they lose out. We see a sense of panic. We feel bad effects set into the economy. Let's talk about slowdown. When that top 2% again starts buying, we will hear a talk of boom. It's going to come. Be ready. But remember, this is a fake boom like previous booms, and it is going to go back to slowdown sooner than later because it only can be sustained by those top 1-2%. Remaining people in India will continue to face the economic hardships that they've faced for the last 30 years. That's the show today. Keep watching NewsClick and do subscribe to us as well.