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Indianhouseholdsownmore assetsthanevertoday.Thisisnotsurprising because the Indiansociety
has become farmore prosperoussince Independence.Economicgrowthhasbeenfast,since the
reformsof the early90s.
Accordingto BostonConsultingGroup (BCG),in2015, 928 householdsownone-fifthof India'sprivate
financial wealth.The BCGexpectsthistogrow to 24 percent by2019. The BCG alsoobservedthat
householdsthatownwealthworthmore than$1 million,hold36percent of India'sprivate financial
wealth.The rate of growthof wealthisthe highestamonghouseholdsthatownassetsworthmore than
$100 million. Butthisisnot a bad thingas many assume because the wealthof the householdsinthe
bottomhalf of the income pyramidhas beengrowingtoo,inthe past25 years.Maybe a small fractionof
the householdsownsmuchof India'swealth.
WhenThe National Sample SurveyOffice (NSSO) didasurveyof householdsassetsin2012-13, they
foundthat the bottom10 percent of urban householdshave anaverage of assetsworthRs291 each.
But the bottom10 per centof the rural householdshave assetsworthRs25,071 each.An average rural
householdhasassetsworthRs10 lakh,and an average urbanhouseholdhasassetsworthRs23 lakh.At
firstglance,itwouldseemthatthe pooresturbanhouseholdsexperience the worstsortof poverty.But
there ismore to thisthan meetsthe eye.Beingurbanisa choice.Many of themare recentmigrantsto
large Indiancities.Theyleftbehindtheirassetsinvillages.So,contraryto whatmany believe,thisdoes
not meanthat life inurbanIndiaishorrible.Thismeansthatpeople are willingtomigrate tolarge cities,
evenat the cost of leavingtheirassetselsewhere.Thismeansthatmigratingtocitiesisworthit,evenat
a huge cost. Much of the assetsof rural Indiansisinthe form of land. Real estate seemstoforma large
fractionof the assetsof Indians,whetherrural or urban.
The average householdassetsinurbanareasare the highestinMaharashtra, the Indianstate that has
the highestslumpopulation.A lookatthe financial assetsshowsthatmostIndiansdonotbenefitfrom
formal banking.Financial assetsof rural householdsare abouttwoper centof theirtotal assets,while
thisisfive percentfor urban Indians.
Accordingto the Censusof India,in2011, of the 78.86 millionurbanhouseholds,64.67 million
householdshadatelephone.Byglobal standards,thisdoesnotseemmuchof anachievement.Butthis
isquite an achievementgivenhow rare telephoneswere,notverylongago.Withoutthe highprivate
participationinthe telecomindustry,thiswouldnothave happened.Forhousingtobecome similarly
affordable,India'slandmarketsshouldsee majorreforms.
In areas,inwhichthe governmentisinvolved,we seegreaterimpoverishment.Forexample,of the
78.86 millionurbanhouseholds,only0.18millionhouseholdsuse electricityforcooking.Of the 167.83
millionrural households,only0.19millionhouseholdsuse electricityforcooking.Of the 167.83 million
rural households,116.25 millionhouseholdsdonothave latrines,andonly51.70 millionhouseholdsget
tap water.In urbanareas,of the 78.86 millionhouseholds,only55.70 millionhouseholdsgettapwater.
Withoutgreaterprivate sectorinvolvement,thisisunlikelytoimprove significantlyinthe nearfuture.
Indian households own  assets
Indian households own  assets

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Indian households own assets

  • 1. Indianhouseholdsownmore assetsthanevertoday.Thisisnotsurprising because the Indiansociety has become farmore prosperoussince Independence.Economicgrowthhasbeenfast,since the reformsof the early90s. Accordingto BostonConsultingGroup (BCG),in2015, 928 householdsownone-fifthof India'sprivate financial wealth.The BCGexpectsthistogrow to 24 percent by2019. The BCG alsoobservedthat householdsthatownwealthworthmore than$1 million,hold36percent of India'sprivate financial wealth.The rate of growthof wealthisthe highestamonghouseholdsthatownassetsworthmore than $100 million. Butthisisnot a bad thingas many assume because the wealthof the householdsinthe bottomhalf of the income pyramidhas beengrowingtoo,inthe past25 years.Maybe a small fractionof the householdsownsmuchof India'swealth. WhenThe National Sample SurveyOffice (NSSO) didasurveyof householdsassetsin2012-13, they foundthat the bottom10 percent of urban householdshave anaverage of assetsworthRs291 each. But the bottom10 per centof the rural householdshave assetsworthRs25,071 each.An average rural householdhasassetsworthRs10 lakh,and an average urbanhouseholdhasassetsworthRs23 lakh.At firstglance,itwouldseemthatthe pooresturbanhouseholdsexperience the worstsortof poverty.But there ismore to thisthan meetsthe eye.Beingurbanisa choice.Many of themare recentmigrantsto large Indiancities.Theyleftbehindtheirassetsinvillages.So,contraryto whatmany believe,thisdoes not meanthat life inurbanIndiaishorrible.Thismeansthatpeople are willingtomigrate tolarge cities, evenat the cost of leavingtheirassetselsewhere.Thismeansthatmigratingtocitiesisworthit,evenat a huge cost. Much of the assetsof rural Indiansisinthe form of land. Real estate seemstoforma large fractionof the assetsof Indians,whetherrural or urban.
  • 2.
  • 3. The average householdassetsinurbanareasare the highestinMaharashtra, the Indianstate that has the highestslumpopulation.A lookatthe financial assetsshowsthatmostIndiansdonotbenefitfrom formal banking.Financial assetsof rural householdsare abouttwoper centof theirtotal assets,while thisisfive percentfor urban Indians.
  • 4. Accordingto the Censusof India,in2011, of the 78.86 millionurbanhouseholds,64.67 million householdshadatelephone.Byglobal standards,thisdoesnotseemmuchof anachievement.Butthis isquite an achievementgivenhow rare telephoneswere,notverylongago.Withoutthe highprivate participationinthe telecomindustry,thiswouldnothave happened.Forhousingtobecome similarly affordable,India'slandmarketsshouldsee majorreforms.
  • 5.
  • 6. In areas,inwhichthe governmentisinvolved,we seegreaterimpoverishment.Forexample,of the 78.86 millionurbanhouseholds,only0.18millionhouseholdsuse electricityforcooking.Of the 167.83 millionrural households,only0.19millionhouseholdsuse electricityforcooking.Of the 167.83 million rural households,116.25 millionhouseholdsdonothave latrines,andonly51.70 millionhouseholdsget tap water.In urbanareas,of the 78.86 millionhouseholds,only55.70 millionhouseholdsgettapwater. Withoutgreaterprivate sectorinvolvement,thisisunlikelytoimprove significantlyinthe nearfuture.