All across India, and all across the world for that matter, Hindus celebrating Diwali provide some interesting insights into how this festival period affects spending habits.
Traditionally, Diwali is a time when Indian parents buy all manner of wonderful gifts for their children, especially new clothes and other essentials.
With each year that passes the Indian economy grows in strength, enabling even the very poorest families to increase their spending habits in celebration of Diwali.
The wealth gap is still massive but those at the bottom of the economic ladder are certainly feeling an increase in their purchasing power.
The Growing Middle Class of India
India’s middle classes now include more than 200 million people, and with salaries increasing year on year parents are experiencing a growing willingness to spend more on their children and other loved ones.
To illustrate this, the children’s market alone is anticipated to continue growing by as much as 35% each year.
Many Western brands have begun branching out in India in an attempt to capitalise on its growing middle class, with clothing brands and toy manufacturers featuring heavily.
CVL Srinivas, chief executive of Maxus, a media buying firm based in Mumbai, was quoted on BBC news saying that “In our research, we’ve found that children are fast becoming the influencers of Indian families’ spending habits.
The numbers are quite revealing: 66% of Indian kids have articulated a brand preference to their folks – an average of 47% of kids are curious about their parents’ purchases across different categories[…] An average of 40% of kids even suggest brands to their parents. The Indian child is fast becoming the decision-maker in terms of purchasing in Indian families.”
Nevertheless, the huge and far-reaching poverty in India cannot be forgotten.
There are millions of families across India who are barely able to sustain themselves, so the growing economy and increasing purchasing power felt by the middle class certainly does not extend to all of Indian society.
Despite a ban on child labour, the United Nations estimates that there are currently between 12 and 60 million children working, with many of them roaming the streets in an attempt to scavenge materials and sell them. Many make little more than a dollar or two per day in this manner.
It is interesting and saddening to see that in a country where so many are enjoying the fruits of a booming economy, there are still many millions who cannot even afford an education, let alone lavish gifts and luxurious Diwali celebrations.
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