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India is set to play a pivotal role in global workforce growth, contributing 20 per cent of it between 2023 and 2050, according to a report by Angel One Wealth. In contrast, China is expected to witness a decline in its workforce during this period.
The report highlighted country's remarkable progress in income levels. It noted that by 2030, the number of high-income households in the country is expected to triple. It said "By 2030 high-income households are expected to triple, while middle-income households will nearly double making India the fastest-growing nation in terms of per capita income". This will significantly reduce the share of low-income households from 43 per cent in 2018 to just 15 per cent by 2030, marking a major shift in income distribution. The report also mentioned that the country is poised to become the fastest-growing nation in terms of per capita income, supported by strong household balance sheets. It noted that India's household debt as a percentage of GDP remains much lower than its Asian peers, reflecting robust income growth and financial health. The country's young demographic profile is another key strength. With an average age of 29 years, India has one of the lowest dependency ratios globally, indicating fewer dependents per working individual. It noted that "With an average age of 29, India has one of the world's lowest dependency ratio, while the same for peers like China and Europe is on a rising trajectory". Meanwhile, dependency ratios in countries like China and across Europe are on the rise, posing economic challenges for these regions. The report also highlighted the impact of rising income levels on consumption patterns. Household growth in India is outpacing population growth, driving discretionary spending faster than non-discretionary spending. This indicates a shift towards higher-value consumption, reflecting the rising affluence of Indian households. On the taxation front, personal income tax collections in India have consistently exceeded corporate tax collections since FY21, reflecting the growing contribution of individuals to the economy. The report outlined that the country's unique position of rapid income growth, low household debt, and a young workforce positions it as a global economic powerhouse, driving not just domestic but also international growth in the coming decades. (ANI)
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