A few years ago, Prof. C.K. Prahalad wrote a visionary paper called ‘Fortune at the Bottom of the Pyramid‘ and in the last few years, corporations have started viewing the BoP as a strong untapped market segment where wealth generation can be done at a massive scale. Indian Telecom giants Reliance and Airtel have made big money by revolutionizing the field of communications and reaching to every other Indian.  More and more companies now are creating products for rural India and low cost is the key word to large profits. Just by sheer number, the Indian market is large enough to make money for anyone who can create value for consumers, at low prices.

But how will the economic pyramid change shape and evolve over-time is an important question to ask? Will it’s height keep increasing and the width of the base decrease, as more and more people move out of poverty?

Should the economic structure take the shape of a cylinder! Yes, may be, but one with a very small height and everyone above the poverty line. This means that the gap between rich and poor should reduce and that there should be as many people who fall in the rich class as in the middle-income class. But that’s doesn’t seem possible and moreover, poverty seems to be more like a subjective word and its definition will also change over time. It seems like no matter how much a country has grown, there would always be people who are poor but what percentage of the population that is, is something we need to think about.  West European economies like Germany are good examples of countries with inclusive growth and development. But then again, how do we define development is another debate in itself? Does it mean travelling by air or it means sleeping on the mat or being a vegan?

Will the economic structure become an inverted cone? That’s not possible! A world with more billionaires than the number of poor and the number of middle class. But it would be a great place to live in. Maybe, I am talking about heaven!

Will it remain a cone and evolve into one with very low height and even the lowest being above the poverty line? Yes, that seems possible and a good situation to live in, too. And probably that’s what’s going to happen. But we will really need to be careful about the word ‘development’ as we grow. Some schools of thought say that the Western nations have distorted the definition of development so much that most of the developing countries are just following that blindly without much thought into what development really means.

All of this discussion reminds of just two places I had visited last year – Barefoot College located in Tilonia, Rajasthan and Auroville in Pondicherry, Tamil Nadu, both great examples of local sustainable development.

By the way, what do YOU think the new demography of India look like?

Advertisements