India’s New Rich

At our Book Club meeting yesterday, we were discussing how BPO was fueling dramatic salary increases for the lucky (and qualified) ones. WSJ writes:

As outsourced jobs pour into India, they are bringing much more than money to this nation of one billion. They are also creating a young, affluent class absorbing Western attitudes at the office, far from parental supervision. The independence of these twentysomethings is helping to unravel time-honored social mores in India, where young people are expected to marry someone their parents choose and live with an extended family. The idea of women working at night was unthinkable until recently.

With all of it came foreign attitudes and behavior. Young people such as Ms. Kalro prefer to spend, not save. They chat on cellphones, buy using credit cards, zip around on motorcycles and eat out at restaurants or cafes. And they are targeted relentlessly by companies that have long waited to see India develop a Western-style consumer class.

“I call these kids ‘liberalization children,’ ” says Rama Bijapurkar, a Bombay-based marketing consultant who sits on the board of Indian software giant Infosys Technologies. “This generation has a hunger in the belly for achievement and all the good things money can buy.”

The WSJ article is more about how call centres are transforming conservatively brought up children into hip youngsters in a short time. It alsmost seems as if Indians are also getting a taste of outsourced Western culture and mores also.

Taking a slightly different view, I think of it as another form of brain drain – the rising salaries are putting this set of people out of reach of Indian companies, and this is happening on Indian soil. I don’t think we’ve considered fully the implications of this.

On a related point, Karthik and Abhay said [in our Book Club discussion]: “This will force Indian companies to start becoming more productive and start using automation.” I think that’s a good opportunity coming up for domestic consumption of IT and IT-related services, deepening the existing market. It will also increase the pressure on Indians to get better educated. So, overall, we should come out ahead, as demand for quality people outstrips supply in the near-term.

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Rajesh Jain

An Entrepreneur based in Mumbai, India.