MUMBAI: India’s biggest 50 cities have seen a huge spurt in consumption as the country races towards high gross domestic product, according to an EY research report.
The 50 largest cities have transformed India into a major consumption hub, the research report said. According to the research report about 12.3 crore people live in these cities and have a household income of Rs 2.6 lakh crore. This at the same time when top 8 Indian cities have a household income of Rs 80,000 crore, the research report—India’s growth paradigm, said.
In the seventh decade of independence over $ 1 trillion has been added to the national GDP, lifting tens of millions into the middle class. The growth has primarily come from cities and the population of urban areas has expanded from 34 crore in 2006 to 43 crore in 2016, the research report added.
According to the research, due to the lower growth in rural areas both metros and new wave cities are expected to exceed national level growth projections till 2020 for population and GDP. But growth in new wave cities has edged out even metros in recent years and there are a few important factors at play. First new wave cities’ younger demographics and higher fertility rates have helped their population bases surpass that of metros. Secondly as India Inc began shifting its focus to these markets and modern technologies and practices filtered through businesses were able to capture low hanging efficiency gains.
“The resulting up-tick in employment prospects helped make these cities attractive destinations for migrants further boosting population levels. AS a result new wave cities registered faster GDP growth in recent years and this is projected to continue till 2020,” the research report added.