1. Ready for ritz?  Yes, says India ’s consumer class who are game for all the goodies in the world, tailored to their unique needs.  Earlier the Indian customer had a habit of saving, but he has now started spending.  He wants to upgrade, be it in clothes, cars or electronic goods.  One manger in IT firm states, “You get one chance at life, and my aim in life is to give the best to myself and my family.” 

International luxury brands flooding Indian market are: Louis Vuitton, Hugo Boss, Chanel, Dior, Jaeger Le Coultre, Ferragamo, Ferre, Aigner.  In queue are Versace, Gucci, Fendi, Valentino, Jimmy Choo and of course, Armani.  Mercedes is considered as status symbol, the trend holds true for othere products too, from jewellery, clothing, watches and footwear to gourmet food, home décor, wellness, travel and entertainment. 

There are 1.6 million households in the country with an annual house hold income of more than Rs. 4.5 million, according to a report by The Knowledge Company.  The report also said that super rich spend at least Rs. 4 lakh a year on luxury products, which translates to a whopping Rs. 64000 crore market in India .  According to the National Council of applied Economic Research, the number of households in India earning over Rs. 10 million a year went up from 20000 six years ago to 53000 in 2005.  According to KPMG thee are 40 million Indians who ear more than Rs. 1.5 million. 

People in India are much more fashion savvy than in most countries.  The upper middle class and the middle class have also gone ‘aspirational’. The upper middle class ensures that at least one bathroom in the house is done with imported tiles.  Nehruvian socialism led to a generation which only knew austerity, shortages, import restrictions and rationing, something that the rich fruits of 15 years of liberalization are putting a decisive end to.  In high end hotels, seven course meal costs Rs. 4500.  Mercedes sold a record 2019 luxury car last year.  An average Indian couple spends Rs. 1.41 lakh while vacationing abroad. (K. Sunil Thomas, The Week 1 October 2006 p.50-62)

2. Gold customers in India: The number of potential women customers for gold in India is 32 million, according to a World Gold Council report.  Between 2002 and 2006 Indian demand rose to 750 tonnes from 571 tonnes despite higher gold prices.  (Business Today, 22 October 2006, p. 37.)

3. The ‘I Can, I Will’ Spenders: It’s an aspirational rush.  Earning more, and younger, urban Indians are buying into a whole new lifestyle of guild-free spending.  One young person in his twenties has changes six cars in five years while the other has changed six models of mobile phones in the past six months. 

Young urban Indians are willing to pay Rs. 5000 for a pair of shoes, one owns 57 pairs.  Some pay Rs. 2000 for a haircut. The ‘spend bug’ has bitten the new-generation-middle class consumers are from families who saved and advocated against conspicuous spending.  The neo middle class thinks: ‘I can (spend), so I will’; ‘One life, live it’; ‘You only live once, enjoy it.’ 

The mindset is changing from self-denial to self-indulgence, saving to shopping.  The Indian consumer’s basket, where seven categories contributed to 80 per cent of the spending in the ‘90s, now has 20 categories accounting for a similar spend.  This implies that a consumer is spending on wider range of products. In a 2006 survey, KSA Techonpak found that 52 percent of urban consumers opt for branded commodities (staples and spices) and two-thirds purchase branded apparel. 

It does not mean that all 250-300 million middle class are on a buying binge, but it is the neo middle class.  Even today, the average spending on items like food, grocery, rents and utilities, education and transport comprises nearly 61.8 per cent of the overall expenditure; 16.1 per cent is spend on lifestyle products; 15.1 per cent on entertainment.   The neo middle class youngsters seem to have their feet firmly on the ground but don’t mind having their heads up in the clouds once a while.  Option to earn more, spend more, economic development, opportunities, high entry level salaries,  access and ability to buy branded products in India are some of the reasons for such spending. 

Globally, it’s observed that as the income level rises; the proportion of income spent on lifestyle-related activities increases.  There is also a shift from the family to the individual.  Economists bracket such consumer behaviour as aspirational.  Many products have become status symbols for the younger generation.  It’s not need but greed that’s driving these purchases. 

Many parents rarely accept what their children are doing today.  Welcome to the 21st century period where spending is an endless, breathless urge that never seems to be spent.  (Alam Srinivas, Arindam Mukherjee and Sugata Srinivasaraju, Outlook, 30 October 2006 p. 36-42)


 A. The honeymoon is over: Three out of five Non Resident Indian marriages in the US are being dissolved in less than a year.  There are about 15600 divorces among NRI in US.  NRI men marry in India bowing down the wishes of their parents even though they have live-in girl friends, or already married foreigner or gay – opt for divorce.  It costs $500 for getting divorce for men while women have to defend by paying $2500-$3000 and other lawyer expenses, which many women could not afford.  More and more NRI are also opting to marry Filipino women.  (Sushmita Bose, Hindustan Times, 8 October 2006 p. 12)

B. Desi housewives get desperate: Deprived of jobs, bored H-4 Visa Holders think of casual sex.  The H-4 dependent visa holders – mostly women-are denied social security numbers and, in many states in USA , even driver’s licenses. This has led to distress, low self-esteem and even an identity crisis.  A survey done on these H-4 visa holders by a US based attorney reveals that the H-4 issue creates an extreme dependence on the primary visa holder and even ends up in broken marriages or wife abuse.  Several women often work illegally, in motels or grocery stores that pay them peanuts.  Many of these highly educated women chat in Internet discussing the idea of casual sex. (Raheel Dhattiwala, The Times of India, 3 October 2006 p.10)

c. How a burgeoning Indian diaspora tunes into the American dream: Roughly 2.3 million people of Indian ancestry, including immigrants and the American-born, now call the U.S. home, according to 2005 Census data. That's up from 1.7 million in 2000. They have big communities in New Jersey , New York , California and Texas , and their average yearly household income is more than $60,000 — 35 per cent higher than the nation overall. Indian Americans, along with Indian expatriates worldwide, sent about $23 billion back to India in 2005, World Bank data show. (http://www.hinduonnet.com/2006/10/24/stories/2006102401782200.htm assessed on 24 October 2006)