The Evening Wrap: Pandemic may have shrunk India’s middle class by a third, says study

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The Evening Wrap Friday | 19 March, 2021

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India's middle class may have shrunk by a third after pandemic, says Pew study
India's middle class may have shrunk by a third due to 2020's pandemic-driven recession, while the number of poor people — earning less than ₹150 per day — more than doubled, according to an analysis by the Pew Research Center. In a comparison, Chinese incomes remained relatively unshaken, with just a 2% drop in the middle class population, it found. The report, released on Thursday, uses World Bank projections of economic growth to estimate the impact of COVID-19 on Indian incomes. The lockdown triggered by the pandemic resulted in shut businesses, lost jobs and falling incomes, plunging the Indian economy into a deep recession. China managed to avoid a contraction, although growth slowed, the report said. "The middle class in India is estimated to have shrunk by 3.2 crore in 2020 as a consequence of the downturn, compared with the number it may have reached absent the pandemic," said the report, defining the middle class as people with incomes of approximately ₹700-1,500 or $10-20 per day. "Meanwhile, the number of people who are poor in India (with incomes of $2 or less a day) is estimated to have increased by 7.5 crore because of the COVID-19 recession. This accounts for nearly 60% of the global increase in poverty," the report added, estimating an increase from almost 6 crore to 13.4 crore poor people. It also noted the record spike in MGNREGA participants as proof that the poor were struggling to find work. The vast majority of India's population fall into the low income tier, earning about ₹150 to 700 per day. Pew's projections suggest this group shrank from 119.7 crore to 116.2 crore per day, with about 3.5 crore dropping below the poverty line. The middle income group is likely to have decreased from almost 10 crore to just 6.6 crore, while the richer population who earn more than ₹1,500 a day also fell almost 30% to 1.8 crore people. Pew warned that the situation may actually be worse than estimated. "The methodology in this analysis assumes that incomes change at the same rate for all people," it explained. "If the COVID-19 recession has worsened inequality, the increase in the number of poor is likely greater than estimated in this analysis, and the decrease in the number who are high income is likely less than estimated. The middle class may have shrunk by more than projected," it added. Trinamool says free and fair elections not possible with 'partisan and biased' Election Commission In a direct attack on the Election Commission (EC), the Trinamool Congress has said that the "partisan and biased approach" of the panel has made "free, fair and transparent elections" in West Bengal a distant reality. A six-member delegation met the EC in Delhi to raise the incident of clashes in Nandigram on Thursday. "It is becoming increasingly clear that free, fair and transparent elections in the State of West Bengal is becoming a distant reality. This is evident from the partisan and biased approach taken by the Election Commission of India," the party's memorandum submitted to the EC said. The TMC particularly flagged the EC's decision of not permitting the State police within 100 metres of a polling station. The EC has noted that only Central forces will be deployed close to the polling stations. The TMC said that this was an "unprecedented" decision and cast aspersions on the reputation of the police administration in the State. The EC had not taken such a decision for the other three States and the Union Territory of Puducherry holding simultaneous polls. The TMC also sought to remind the Commission that the State police had worked with governments led by other political parties too. "Propriety demands that there should be proper coordination between the State and Central forces to ensure free and fair elections and that combined groups of both State and Central police forces be deployed within 100 metres of the polling station," the memorandum said. The party also expressed disappointment with the EC for not agreeing to their demand to tally the Electronic Voting Machine (EVM) results with Voter Verifiable Paper Audit Trail (VVPAT) in every booth. The EVM-VVPAT are tallied in a randomly selected sample. The EC has argued that tallying each and every EVM with the VVPAT will delay the counting and declaration of results. "It may be noted that the very purpose of installing VVPAT machines at considerable costs has deliberately been made redundant and ineffective," the party memorandum said. Only a 100% tallying of VVPAT and EVMs could assure the voters that his/her choice had indeed been recorded, TMC said. The party asked the EC to withdraw both these decisions. Centre asks Delhi High Court to restrain WhatsApp from implementing its new privacy policy The Centre on Friday asked the Delhi High Court to restrain instant messenger app WhatsApp from implementing its new privacy policy, which is likely to take effect from May 15. The Ministry of Electronics and Information Technology (MeitY), in an affidavit filed before the High Court, stated that WhatsApp's new privacy policy was not in tune with the Information Technology (Intermediary Guidelines) Rules, 2011. "Notably, the Rules require a body corporate who collects, stores or otherwise deals with data to issue a privacy policy providing for certain safeguards, in addition to imposing various other obligations. The impugned Privacy policy violates the 2011 Rules..," MeitY said. The Ministry said WhatsApp's new privacy policy "fails to specify types of sensitive personal data being collected". "Crucially there is no distinction between personal data or sensitive personal data which is being collected," the Ministry said, apart from WhatsApp failing to notify users on details of collection of sensitive personal information. "The privacy policy mentions the involvement of third-party service providers who may have access to the data. However, the names of these service providers and other associated details have not been provided," it said. The Ministry's stand came in response to a petition challenging WhatsApp's new privacy policy, which provided for sharing information with third party service providers and other Facebook companies. The High Court has posted the case for further hearing on April 20. Assam Elections | BJP selling hatred to divide people, says Rahul Gandhi Congress leader Rahul Gandhi on Friday slammed the BJP for "selling hatred" to divide the people while reaffirming his party's commitment to nullifying the Citizenship (Amendment) Act (CAA) and raise the daily wage of tea plantation workers to ₹365 if the party was voted to power in Assam. On a two-day visit to campaign for the 10-party Mahajot or grand alliance, Gandhi's programme ranged from interacting with college students at Lahowal and meeting tea plantation workers at Chabua — both in eastern Assam's Dibrugarh district — to addressing a public rally at Doomdooma in the adjoining Tinsukia district. "No religion teaches enmity. But the BJP uses religion to divide society. They sell and spread hatred wherever they go while the Congress tries to promote love and harmony," he told the students. He also took a swipe at the RSS, the BJP's ideological fountainhead. "There is one force in Nagpur [headquarters of the RSS] that is trying to control the country, but the youth must resist this attempt with love and confidence, Gandhi said. During the interaction and at the public rally later, the Congress leader asserted that the Congress and its allies, if voted to power in Assam, would ensure that the CAA was not implemented in the State. Delhi High Court refuses to stay ED summons issued to Mehbooba Mufti The Delhi High Court on Friday refused to stay the summons issued to former Jammu and Kashmir Chief Minister Mehbooba Mufti by the Enforcement Directorate in a money-laundering case. A bench of Chief Justice D.N. Patel and Justice Jasmeet Singh declined any relief to the 61-year-old, saying, "We are not giving any stay. We are not granting any relief." The court has posted the hearing on her petition for April 16. Solicitor General Tushar Mehta, representing the ED, said Mufti just has to appear before the officials. The ED has now summoned Mufti for March 22. The People's Democratic Party (PDP) chief, in her plea, has contended that ever since she was released from preventive detention following the formal abrogation of Article 370, she has been facing a series of "hostile acts by the State". She has alleged that the ED is conducting a "roving inquiry about her personal, political and financial affairs". She also pointed out her acquaintances and old family friends have also been summoned by the agency. Biden urged to rescind H-1B ban Five Democratic senators on Thursday urged President Joe Biden to rescind his predecessor Donald Trump's ban on some non-immigrant visas, including the H-1B visa, which is popular among Indian IT professionals. They said the ban creates uncertainties for U.S. employers, their foreign-born professional workers, and their families. In June 2020, Trump had instituted Proclamation 10052, halting the processing of non-immigrant H-1B, L-1, H-2B, and J-1 visas, based on the alleged potential risk to the labour market. Although Proclamation 10052 is set to expire on March 31, 2021, businesses have indicated that inaction will further harm their businesses and economic recovery. The senators said that because the visas that Proclamation 10052 halted either target low-unemployment professions or require that the visa holder does not displace an American worker, businesses that rely on foreign workers have struggled to fill jobs despite increased unemployment. Reports have suggested that jobs in fields such as information technology -- which H-1B visa holders would have filled -- have remained open or were moved overseas, said senators Michael Bennet, Jeanne Shaheen, Angus King, Cory Booker, and Bob Menendez. The H-1B visa is a non-immigrant visa that allows US companies to employ foreign workers in specialty occupations that require theoretical or technical expertise. Technology companies depend on it to hire tens of thousands of employees each year from countries like India and China. Covid Watch: Numbers and Developments The number of reported coronavirus cases from India stood at 1,15,50,878 at the time of publishing this newsletter, with the death toll at 1,60,932. India reported 39,726 new COVID-19 cases on Friday, the highest since November 29. There were 20,654 recoveries and 154 deaths in the last 24 hours, Health Ministry data said. Three states, Maharashtra, Kerala and Punjab, account for a little over three-fourths of the total active cases. All theatres, auditoriums and offices in Maharashtra will take in only 50% of their capacity till March 31 amid a surge in COVID-19 cases, the state government said in an order today. In Brief The Lok Sabha today passed The Constitution (Scheduled Castes) Order (Amendment) Bill, 2021, that seeks to put seven castes under one nomenclature of "Devendrakula Vellalars" with some exceptions for some of the castes in certain districts of Tamil Nadu. The castes include Devendrakulathan, Kadaiyan, Kalladi, Kudumban, Pallan, Pannadi and Vathiriyan. Evening Wrap will return tomorrow.

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