A global economic slowdown has shrunk the world’s middle-class population and impoverished millions. According to new research by Pew Research Center of the US, In 2020, nearly 131 million people will have settled into poverty and low-income groups. People of upper-middle- and middle-income people became low-income and poor within just a blink of an eye.
South Asian region have the largest amount of poor and low-income people
This rising poverty appears to be found mostly in the South Asian region, which “is estimated to have added nearly double the number of people to the ranks of the globally poor as sub-Saharan Africa in the pandemic,” Pew’s research found.
“The percentage increase in poverty in South Asia (75%) dwarfs the increase in sub-Saharan Africa (8%).” said the research person.
Impact on GDP
The projected economic slump and its impact on an area’s GDP appear to correspond to how sharply a region’s gross domestic product (GDP) is falling.
“The relatively outsized role of South Asia in the contraction of the global middle class and the expansion of poverty is the result of it seeing the sharpest reduction in economic growth in the pandemic,” Pew added.
India, the worst-hit country in South Asia
India seems to be the worst-hit country in entire South Asia, both in terms of the sharp rise of the poverty line and contracting GDP.
75 million people were added to poverty in India accounting for a rise of 60% in poor populations globally. The neighboring country, China added 1 million to its poor population, says the report.
India performs worse on income parameters
India performed worse on income parameters compared to pre-pandemic estimates. The country was about to have a middle-class population of 99 million by 2020. By Pew’s estimates, that number is now cut by third to 66 million.
As per the research, the number of poor were expected to be at 59 million, which is now standing at 134 million. This remarkably reverses the momentum India had achieved in reducing poverty over the past 10 years.
“The projected rise in poverty in 2020 when comparing pre-pandemic and revised figures—75 million—claws back several years of progress on this front for India,” Pew noted.
