Congress Questions Government Over 'Shrinking' Urban Middle Class

The Congress has raised concerns about significant economic challenges affecting India's urban middle class. Highlighting slowed household consumption and reduced net savings, they question Prime Minister Modi's acknowledgment of these issues. The Congress cites economic downturns and technological disruptions as major contributors to these growing concerns.

The Congress on Wednesday raised an alarm over significant economic challenges impacting urban middle-class consumption patterns, urging Prime Minister Narendra Modi to address the issue. Congress General Secretary Jairam Ramesh noted prominent figures from India Inc have expressed concerns about private consumption slowdowns, particularly in the FMCG sector.

Ramesh referred to a report by Marcellus Investment Managers identifying three primary economic challenges affecting consumption. He pointed to the deterioration of household balance sheets, citing data from the RBI showing net household savings as a percentage of GDP have hit their lowest in nearly 50 years due to mounting unsecured loans.

He emphasized that economic downturns and technological disruptions are hurting middle-class employment, with routine jobs increasingly replaced by automation and outsourcing. These issues, alongside reduced corporate earnings, contribute to the 'shrinking' urban middle class, which the Congress leader insists needs government recognition and action.

(With inputs from agencies.)