India's middle class population to rise, key driver for Asia's rise by 2050

NEW DELHI: Nearly 70% of India's population could be middle class within 15 years if the country's economy posts sustained growth, a report by the Manila-based Asian Development has said. These structural shifts in the pattern of global demand mean that Asia's growth can rely increasingly on the markets of developing Asia rather than those of Europe, Japan or North America, the report said.
If Asian middle class consumers can substitute for those in advanced economies, the Asian countries will become major exporters to each other, emulating Europe. European countries are significant exporters, but largely to each other, with Eurozone exports growing 4.5% a year since 20005, notwithstanding the recent recession. Similarly, all Asian countries could benefit from rapid intra-regional growth without excessive reliance on the consumer markets of Europe or North America.
"Today, India has a tiny middle class by global standards. But if it continues its growth, 70% of the Indian population could be middle class within 15 years," the ADB the report said. The Indian economy, Asia's third-largest has been growing above 8% and has contributed significantly to rising prosperity. The rapid economic expansion has also attracted the attention of global companies and investors, many of whom have set up shop in the country. The ADB report says that Asia rise will be led by China, India, Indonesia, Japan, South Korea, Malaysia, and Thailand.
By 2050 their share in population is expected to fall to 73% of Asia, while the share of GDP rises to 90%. These seven economies alone will account for 45% of global GDP. Their average per capita income of $45,800 (purchasing power parity) would be 25% higher than the global average of $36,600. In 2010 these seven economies had a combined total population of 3.1 billion (78% of Asia) and a GDP of $14.2 trillion (87%of Asia).