Middle class in India : Problems and Prospects

 Why is it in the news ?

1. Budget of FY 25-26 gave concessions to the middle class by alleviating the tax burden upon them. The finance minister raised the income tax exemption threshold from ₹7 lakh to ₹12 lakh per annum. The inclusion of ₹75000 as standard deduction alleviates the tax free income limit to ₹12.75 lakh. Thus, those taxpayers who are earning ₹25 lakh annually can save up to ₹1.1 lakh, individuals earning ₹10 lakh can save ₹50 thousand and individuals earning ₹15 lakh can save ₹75 thousand.

The new tax slabs would give the following benefit to the people

Income	Total Benefit
Up to 8 Lakh	₹30000
9 Lakh	₹40000
10 Lakh	₹50000
11 Lakh	₹65000
12 Lakh	₹80000
16 Lakh	₹50000
20 Lakh	₹90000
24 Lakh	₹110000

The tax concession caused a revenue loss of approximately ₹1 lakh crore to the government. However, the government expects that the tax reduction would boost household consumption and improve economic growth by creating aggregate demand in the economy.  The government was forced to give concessions to the middle class because according to RBI data, the net household savings as percentage of GDP was at the lowest level in the last 50 years. Secondly, the mounting unsecured loans have pushed net savings to a low level, leaving families with less disposable income. Elevated food inflation, high interest rates and shrinking discretionary income have made it difficult for the middle class to maintain their previous spending levels. 

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Who is middle class in India ? 

1. According to the People Research on India’s Consumer Economy (PRICE), the middle class consists of individuals having annual income between ₹5 lakh to 30 lakh. 

2. According to NCAER (Council for Applied Economic Research), the middle class in India are those whose annual earning is between ₹2 lakh to 10 lakh. 

3. According to the World Bank, individuals earning between $10 and $20 per day (₹313200-522000)are in the middle class. 

4. According to Pew Research Centre, individuals earning between $10 to $20 per day can be put under middle class. 

5.Apart from income criteria, the middle class can be defined also on the basis of occupation. It includes salaried professionals, government employees, small business owners and skilled workers.  

Changing contours of middle class in India

1. The middle class now represents 31% of India’s population of 1.40 billion. It is projected to hit 38% by 2031 and 60% by 2047. Thus, by the middle of this century India is projected to have a middle class population of around 1 billion. 

2. During the British Rule, a small number of middle class arose on account of industrialisation in India. They were professionals, business managers, lawyers, doctors, bankers, teachers etc. 

3. After independence, the middle class was largely created by the public sector undertaking. However, by 1995, the organised private sector became also powerful employing 80.6 lakh while the public sector employed 194.7 lakh. Before the year 2000, public sector undertakings and railways had a predominant share in employment but after 2011-12, the trend shifted towards IT companies. Now they employ more than railways, public sector undertakings and defence. Similarly, the private banks also surpassed in 2023-24 the scheduled commercial banks in matters of employment. Thus, IT, finance, accountancy, legal, health, hospitality, tourism, transportation, logistics, aviation, media, advertising, sports, entertainment, real estate and retail services led to the growth of the middle class in India. The middle class has now become all pervasive. It has now spread even to rural areas because of the rising incomes of farmers and individuals living in villages. The new middle class arose because of the exponential growth in the services sector.  They are employed more in IT, MNCs, and the Gig economy. They have multiple sources of income. They are highly entrepreneurial and want to launch a startup to get self employment instead depending upon government jobs.  However, since the Indian economy did not experience structural transformation like in China, the middle class rose more in the services sector. The limited growth of manufacturing and agriculture sectors put a limit on the growth of the middle class in the primary and secondary sectors. Even in the services sector, the growth of the middle class is limited because of insecurity of job and low paid salaries to workers employed in the unorganised sector which constitute 94% of the total employment in India. Similarly, India witnessed huge growth of Gig workers in companies like Zomato, Uber, Ola, Flipkart, Amazon. But because of their insecurity of job and low paid salaries, these sectors put a break upon the growth of the middle class in India. 

Problems of middle class

1. Although the middle class in India produces half of the national income, it is being confronted with several problems. These are : 

• Wages are not increasing in proportion to the rising inflation. 

• There is huge competition for getting government jobs. Thousands of candidates apply for the high salaried jobs for a few posts, showing acute unemployment among the middle class in India. 

• Because of the advent of artificial intelligence and automation, most of the managerial posts in the companies are disappearing. 

• Because of the digital platform, the Gig economy is rising. But Gig workers have low paid salaries and insecurity of tenures, putting a break upon the growth of the middle class. 

• High cost of education and healthcare further reduce the disposable income of the middle class. 

• Skyrocketing property prices makes it difficult for the middle class to own houses in the urban centres.

• Increasing expenses on account of rising cost of diesel and petrol have put a break upon their mobility.  

• Long hours of work in banking, IT and corporates have strained their physical and mental health. Work pressure leaves little time for their personal upkeep and prevents them from leading a good family life. 

Prospects of middle class 

1.The prospects of the middle class in India in the coming year are very bright.

2. It is expected that by 2050, the population of the middle class would go to one billion. Thus, it would have more political clout than before. 

3. With the increasing disposable income , the middle class would be investing more in mutual funds stocks and crypto currencies. 

4. Due to the government's efforts to launch a smart cities mission, the middle class will find affordable housing facilities. 

5. The increased income of the middle class would further lead to the growth of real estate, automobiles and consumer goods.   

6. With the increasing population of the middle class, there would be a shift from blue colour jobs to white colour jobs in the sectors like E-commerce, IT, Finance and Health sector. 

7. The digitalisation of the economy would further boost the expansion of the Gig economy, E-learning and skilling. These new avenues would further boost the growth of the middle class in the country.  

8. With the higher disposable income, the new middle class would venture  start-ups more vigorously.  

9. The National Manufacturing Mission initiated by the government would further broaden the base of the middle class in the sectors of manufacturing, construction and transportation. 

10. The expansion of the Green Revolution in Eastern India by the injection of new technologies would further raise the income level of farmers and individuals living in rural areas. This would further expand the base of the middle class in the agricultural sector.  Dhan Dhanya Krishi Yojana initiated in the budget 2025-26 would further boost the production and productivity in the 100 low productivity districts in India, increasing the income of individuals living in rural areas. This would further broaden the base of the middle class not only in the urban centres but in rural areas also.   

Conclusion 

1. The Indian middle class is an aspirational class. With the increasing income, digitalisation, urbanisation, transformation in agricultural and industrial sectors, the middle class is going to become the most powerful class and the engine of growth of the Indian economy. It is hoped that with the growth of the middle class, Indian democracy will further strengthen. 

2. The rising middle class would be able to surpass the US by 2050 in nominal GDP, becoming the second largest economy of the world after China. Thus, the future of India lies with the growth and aspirations of the middle class.

Is the Indian Constitution a federal structure ?

 Why is it in the news?

Hon’ble Shri DY Chandrachud, the Chief Justice of India, while delivering inaugural Lok Satta lecture in Mumbai on 26th October, said “States and union are both creatures of the constitution. They must act in deference to their legislative boundaries in finding meaningful solutions to modern day problems. Our ability to address these challenges is the litmus test for our imperfect federalism and the framers’ faith in it. If federalism in the years gone by was about adjusting to political realities in terms of legislative powers, in the years to come should be evaluated based on its ability to foster democracy and constitutional ideals of equality, liberty, dignity and fraternity. “

Introduction

The Indian Constitution does not use the word federation. Instead, it uses the term union. Article 1 says that India, that is , Bharat shall be a union of states. It means that unlike federation, the central government is not the outcome of agreement among federating units. Secondly,  the federating units have no right to secede from the central government. However, the Indian constitution postulates a federation with a centralising tendency. In the Bommai case (1994), the Supreme Court laid down that the constitution of India is federal and federalism is its basic feature. The court held that the states have independent constitutional existence. They are not subordinates or agents of the centre. Within the sphere allotted to them, states are supreme. 

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What is Federalism ?

1.Federalism pre-supposes a dual government where both central and the state governments derive their power from the constitution. The power is divided between the national and state governments with clear boundaries. Secondly, it has a written constitution where both central and state governments have defined jurisdictions.  An independent judiciary which acts as the guardian of the constitution. Bicameral legislature is established whereby the second chamber represents the interests of the states. Federalism pre-supposes a rigid constitution so that no constitutional amendment can be made by ordinary legislation. In a federal structure, supremacy of the constitution is of paramount importance and thus, whenever Parliament or State legislature exceeds its power or does not conform to the provisions of the constitution, the laws passed by the Parliament or state assemblies are struck down. 

2.On the contrary, in a unitary government, all powers are vested in the central government. Moreover, the central government creates regional governments like in the UK. 

Federal features of the Indian Constitution

1.The constitution of India establishes a dual polity consisting of the union and state governments. At present, there are 28 states. They have been assigned powers separately. They are not subordinate to the Union Government. While, the Union Government deals with foreign, defence, currency, communication and so on the state governments have been bestowed with to work for regional interests like public order, agriculture, health, local self government, police etc. 

2. The Seventh Schedule of the constitution of India consists of three lists - The Union List comprising 100 subjects, the State List comprising 59 subjects and the Concurrent List comprising 52 subjects. Both the central and state governments can make laws on the subjects included in the concurrent list. But in case of any conflict, the laws made by the Parliament would supersede the laws made by state assemblies under concurrent lists. However, unlike the US constitution, the residuary subjects are vested in the central government. 

3.Our constitution clearly gives its supremacy. Thus, in case the Parliament or State Legislature exceeds its powers or its limitations, the laws passed by the legislature or parliament are declared null and void by the Supreme Court under judicial review. 

4. Ours is a written constitution. The constitution was drafted and prepared by the constituent assembly represented by 299 members from the nook and corner of the country. It contains 470 articles and 12 schedules. The constitution has clearly discussed and demarcated  the structures and functions of the central, state and local governments. 

5.Our constitution is a mixture of flexibility and rigidity. While some of the provisions of the constitution can be amended by both Houses of the Parliament with special majority, the federal structure like the central state relations, judiciary, inter-state commerce can only be amended by both Houses of Parliament and  the concurrence of half of the state legislature by the simple majority. 

6. Our constitution has made provisions for an independent judiciary by securing the tenures of judges, fixed conditions of service and independence from the executive. It has also been assigned the task to settle the disputes between the union and the state governments or between state governments. 

7. Our constitution lays down a bicameral legislature consisting of an Upper House (Rajya Sabha) and a Lower House (Lok Sabha). While the Lower House is elected on the basis of universal suffrage, the Upper House is represented by states to protect their interests.  

8.The judicial intervention by the Supreme Court further strengthened the federal features of our constitution. For example, the Supreme Court held that a bill passed by the state legislature and presented before the Governor for his assent, cannot withhold the bill indefinitely. Rather a Governor can withhold with the assent of the bill only to send it for reconsideration, thereby circumscribing the discretionary power of the Governor.   Similarly, in the Bommai case (1994), the Supreme Court held that the test of the majority can only be held at the floor of the House, thereby, limiting the misuse of article 356 by the Governor for the imposition of  the President’s Rule in the state. 

9. Assertion of autonomy by states, demand for more financial grants by the states from the divisible pool of the central proceeds, disputes between states over the sharing of river water, territorial disputes between different states, creation of new states and finally emergence of regional parties to reduce regional disparities and for balanced regional development are some of the important federal trends that are being reflected in the working of the constitution of India for the last 75 years. 

Centralising features of the constitution of India  

There are certain centralising features which contrast the Indian constitution from the US constitution in so far as  the federal features are concerned. These are 

• Emergency Provisions under articles 352, 356 and 360

• Integrated judiciary 

• All India Services 

• Integrated audit system

• Integrated election commission

• Appointment/ Powers and Functions of Governor

• Parliament's authority even in the matters relating to the state list

• Single citizenship 

• Single constitution

• No equality of state representation in the Rajya Sabha

• More powers to the union government than state governments 

• The President enjoys absolute veto over state bills 

Conclusion

1. The Indian constitution postulates cooperative federalism where the union and state governments work together to iron out the differences that arise in governance to achieve the common goal of development. 

2. The states are in no way dependent upon the centre for the legislative or the executive authority. Both the centre and the state derive their power from the constitution itself. 

3.However, to strengthen the unity and integrity of India, certain exceptional provisions were made to face the challenges in abnormal/ exceptional situations so that in case of emergencies , India acts as a single powerful body. That’s why provisions of emergency, flexibility in the amendment of the constitution and a strong central government have been made. 

Justice in Indian Constitution

 Introduction 

Along with liberty, equality and fraternity, justice is the cornerstone of the Indian constitution. Only in a society permeated by justice, one can expect the enjoyment of liberty, equality and fraternity. Thus, justice presupposes the booming democracy. No justice can thrive in a set-up which is guided by dictatorship. 

The Supreme Court inaugurated : Lady of Justice without blindfold
with scale in her right hand and constitution of India in the left hand 

Definition-

1.According to Plato, Justice is to establish harmony where rulers, warriors and producers (farmers and artisans) perform its designated function without interfering with others. 

2.According to Kautilya, Justice meant protecting citizens, maintaining order by enforcing proportionate punishment and ensuring King’s responsibility to uphold Dharma for the welfare of the state and society. 

3. According to Aristotle, Justice has two components - distributive justice, whereby fair distribution of resources is carried out and corrective justice where wrongs are rectified. He stressed upon equality and fairness. 

4.According to  John Rawls, Justice is achieved when society ensures fairness specially for the most vulnerable. 

5. According to Thomas Hobbes, Justice is achieved when a social contract is made for the preservation of peace and order with the sovereign for enforcing justice.

6. According to Karl Marx,  Justice can be achieved when a classless society is established through class struggle, where inequality is eradicated. 

7. According to John Stuart Mill, Justice is essential to the principle of utility where the aim is the greatest happiness of the greatest number.

8.According to Amartya Sen, Justice means improvement of people's actual life by enhancing people’s freedom and capabilities. 

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Provision of justice in Indian Constitution

1.Preamble - The Preamble consists of three types of justice - social, economic and political. 

• Social justice means equal treatment of all citizens without any social distinction based on caste, colour, race, religion, sex and so on. It means absence of privileges being extended to any particular sections of the society. It also means improvement in the conditions of scheduled castes, scheduled tribes, and other backward classes.

• Economic Justice means non-discrimination between people on the basis of economic factors. It means elimination of glaring inequality in wealth, income and property. 

• Political justice means  all citizens should have equal political rights, equal access to all political offices and equal voice in the Government. 

2.Fundamental Rights - 

• Article 14 ensures the right to equality before law and equal protection from law.

• Article 15 prohibits discrimination on the grounds of religion, race, caste, sex or place of birth. 

• Article 16 guarantees equality of opportunity in public employment, ensuring that every citizen has the equal chance.

• Article 17 abolishes all kinds of untouchability.

• Article 18 abolishes all kinds of titles, except those titles given on the merit. 

• Article 19 provides freedom such as the right to free speech and expression, assembly, association, movement, residence and profession. 

• Article 20 provides no ex post facto law. It means no person shall be convicted of any offence except for violation for law in force at the time of the commission of the act. No double jeopardy which means no person should be persecuted and punished for the same offence for more than once. No self-incrimination which means no person accused of any offence shall be compelled to be a witness against himself.  

• Article 21 guarantees the right to life and personal liberty. The Supreme Court has enlarged the scope of this article to include right to live with human dignity, right to decent environment, right to livelihood, right to shelter, right to health, right to free education up to 14 years of age , right to free legal aid, right against handcuffing, right to speedy trial, right against inhuman treatment, right against bonded labour, right against custodial harassment, right to emergency medical aid, right to fair trial, right to family pension, right to marry a person of one’s choice, right to privacy etc. 

• Article 22 provides protection against arrest and detention, right to be informed on the grounds of arrest and access to legal representation. 

• Article 23 prohibits trafficking in human beings and forced labour.

• Article 24 prohibits the employment of children below the age of 14 years in any factory, mine or other hazardous activities like construction work of railway. 

3.Directive Principles of State Policy 

• Article 38 promotes the welfare of the people by securing social economic and political justice and to minimise inequality income status, facilities and opportunities. 

• Article 39 secures -

(a) the right to adequate means of livelihood for all the citizens 

(b) Equitable distribution of material resources of the community for the common good. 

(c) Prevention of concentration of wealth and means of production

(d) Equal pay for equal work for men and women

(e) Preservation of health and strength  of workers and children against the forceable abuse. 

(f) Opportunity for healthy development of children and protection of childhood and youth against exploitation and against moral and material abandonment. 

• Article 39 (A) promotes equal justice and provides free legal aid to the poor. 

• Article 41 secures the right to work, to education and to public assistance in case of unemployment, old age, sickness and disablement.

• Article 42 makes provision for just and humane conditions of work and maternity relief.

• Article 43 secures a living wage, a decent standard of life, social and cultural opportunities for all workers.  

• Article 43 A secures the participation of workers in the management of industries.

• Article 47 raises the level of nutrition and standard of living of people and improves public health. 

• Article 46 promotes the educational and economic interest of SC,ST and other weaker sections of the society and to protect them from social injustice and exploitation. 

• Article 45 provides early childhood care and education for all children until they complete the age of six years. 

• Article 48 organises agriculture and animal husbandry on modern and scientific lines. 

4.Judicial review - The constitution of India authorises the higher judiciary like Supreme Court and High Courts to declare any law passed by Parliament or state legislatures null and void if that law contravenes the provisions of constitution. Thus, the Supreme Court of India struck down a number of laws passed by the Parliament. Recently, the Supreme Court upheld the classification of scheduled castes and scheduled tribes for reservation to provide reservation benefits to marginalised groups within these castes and tribes.

5. Public Interest Litigation - It allows individuals or groups to approach the judiciary to seek legal remedies for public issues, providing an effective means for the poor or marginalised to access justice. Thus, the provision of locus standi was removed so that public issues may be raised in the Supreme Court and High Courts. 

6.Legal Aid and Free Justice - The Legal Services Authority Act,1987, formalises the provision of free legal aid to unprivileged sections, reinforcing the constitutional directives under article 39 A. 

Achievements of Justice in India since Independence 

1. India successfully conducted 18 elections since independence and thus strengthened democratic set-up by giving reservation to scheduled castes and scheduled tribes in Parliament. By the 73rd and 74th amendments, democratic decentralisation was carried out at the district and down to the village level. 33% reservation to women was provided in these local bodies. Some states like Bihar reserved 50% reservation for women. Similarly, reservation to SCs and STs was provided in these local bodies commensurate with their population. 

2. India achieved self-sufficiency in food production by the introduction of the Green Revolution. It has become the fastest growing economy in the world. It has made efforts for economic inclusion by launching welfare schemes like MGNREGA ,Pradhan Mantri Jan Dhan Yojana, and Pradhan Mantri Mudra Yojana. Almost all states have passed land reforms whereby intermediaries like zamindars, jagirdars were abolished. By tenancy reforms, security of tenure and fair rent were ensured. Surplus lands of more than 60 lakh hectares were distributed among landless and marginalised farmers. The maternity benefits Act 1961, and Equal Remuneration Act, 1976 have been  made to protect the interest of women workers. The Nationalisation of 21 banks and abolition of privy purses were made to promote common good.  

3.Social justice has been achieved by making untouchability a crime. The SC, ST Atrocities Prevention Act, 1989 further strengthened the position of these communities. Legal reforms with regard to marriage inheritance and workplace harassment have been carried out. 

Challenges 

1.In spite of the great progress made by India since independence, political corruption, criminalisation of politics, muscle power in the election are on the rise. There is a lesser representation of women in Parliament. Even Pakistan has better women's presentations in Parliament than in India. Similarly, political participation of marginalised groups and women is very much limited in the higher level of governance. 

2. In spite of being the fifth largest economy of the world in nominal GDP, India has become the most unequal society in the world. Only 1% people from the top have captured 22% of the national income and 40% of the wealth of India. The informal sector which produces 92% of the employment suffers from low wages, insecurity of jobs and unhygienic conditions of the workplace. India ranks 108th out of 193 countries in 2022 in the gender inequality index. The labour force participation for women is at 28.3 % which is very low when compared with China, Japan and South Korea.

3. The caste based discrimination is still prevalent in rural areas. Work force participation for women is still low due to gender bias. The minority communities suffer from inadequate representation and frequent communal flare up. 

Conclusion 

1.To sum up, justice in India can be achieved and would be provided to millions of people by adopting inclusive growth, ensuring the economic growth benefits to all sections of the society. This would be ensured by reducing inequality, eradicating poverty, creating employment opportunities, improving social cohesion, reducing gender gap and by achieving  sustainable development goals.