Rajesh Shukla: India’s growth is impressive but let’s universalize the gains

Estimates based on data from the PRICE ICE 360° survey offer valuable insights into how income, consumption, savings and debt are distributed across households. It reveals that India is not one economy, but three. 

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At the top, the richest 20% of households account for ₹155 trillion in income, save ₹57 trillion and consume just 63.6% of what they earn. In stark contrast, the bottom 20% earn ₹22 trillion but spend ₹23 trillion, resulting in negative savings and the highest debt-to-income ratio of 15.4%. The middle 60%, earning ₹159 trillion and saving ₹28 trillion, are the backbone of consumption but remain economically vulnerable.

These numbers highlight a macro-micro disconnect. India’s 25% household saving rate and 11.9% average debt burden appear healthy in aggregate, but are deeply unequal in distribution. Without corrective action, this imbalance could undermine both financial resilience and the long-term stability needed to realize Viksit Bharat, India’s vision of becoming a fully developed economy by 2047.

To bridge this gap, policymakers must shift their focus from redistribution to empowerment. For the bottom 20%, this means increasing earning capacity through job creation, skilling and formalization. For middle India, it means expanding access to affordable insurance, pension schemes and tax-friendly savings tools. For the top 20%,  the principal challenge is ensuring their disposable income is directed toward productive and inclusive investments—infrastructure, climate innovation and capital markets that strengthen national development.

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India’s Digital Public Infrastructure (DPI)—comprising Aadhaar, Unified Payments Interface, Jan Dhan and the Open Network for Digital Commerce—provides the foundation to deliver these changes at scale. Already used to disburse benefits and enable digital transactions, DPI can now evolve to support personalized financial products, improve credit visibility and build trust among informal earners.

This inclusivity is not just a policy imperative—it’s also an investment thesis. For investors, both domestic and global, the most compelling opportunities lie not in India’s already-saturated top tier, but in the middle and lower segments, where unmet demand for credit, healthcare, insurance and education remains vast.

The middle 60% present a sweet spot. With an income of ₹159 trillion and rising digital adoption, they are underserved but aspirational. Fintech solutions tailored to their risk tolerance, low-cost health-tech and vernacular ed-tech platforms can unlock sustainable long-term returns. Meanwhile, the bottom 20%, though often overlooked, represent the future of inclusive financial markets—especially through microfinance, rural distribution and community-based innovations.

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The top 20% will continue to seek global investment products and premium services. But India’s structural growth will come from businesses and investors that move ‘down-market’ with purpose—driven not just by reach, but by relevance. India’s capital markets and financial institutions have a unique opportunity to support inclusive entrepreneurship and innovation.

This dual narrative—of a rising GDP and persistent household-level fragility—should also reshape how international observers engage with India. While India is increasingly seen as a strategic counterweight in Asia and a digital innovator, global policymakers and development institutions must also recognize the complexity beneath the surface. A young, largely informal and multilingual democracy that is digitizing and industrializing at the same time presents unique development challenges—and solutions.

International businesses entering India must go beyond urban centres and adapt products for affordability, accessibility and cultural diversity. Development partners would find in India a test laboratory for scalable, tech-enabled inclusion models that can be applied globally, from micro-insurance and telemedicine to skilling and public digital infrastructure.

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At the heart of this shift is a simple but powerful idea: gross domestic product (GDP) milestones matter, but they are not enough. India’s rise must be measured not just by how much it produces, but by how widely its disposable income supports real improvements in living standards. Broad-based progress is both a moral imperative and an economic necessity.

A developed India is not just one where the  top 20% invest confidently in markets—it is  one where the middle 60% build assets and the bottom 20% live without the fear of debt traps or sudden income loss. This transformation will not come from growth alone. It will come from intentional inclusion, backed by smart policy, targeted investment and an unwavering focus on financial dignity for all.

The next phase of India’s journey will be defined not by how fast it grows, but by who grows with it. By aligning capital with inclusion, by making DPI work for every household and by supporting the informal majority with formal tools, India can truly set the global standard for development. In doing so, India will show the world that development is not just about size, but about shared prosperity.

Viksit Bharat by 2047 is within reach. But to get there, India must now grow not only upward—but outward and across.

The author is managing director and chief executive officer of People Research on India’s Consumer Economy.