Bring the muddle of the middle class in order

India’s large middle class is pretty much at large with its current state of financial wellbeing. Rising mercury in many parts of the country is adding to its financial woes with higher electricity bills. Work-from-home has resulted in higher spends on high-speed internet while those going to office are struggling with sky-high fuel bills. Add to that pay cuts and job losses that Covid-19 has partly been responsible for causing, the woes seem unending.

It doesn’t help that food inflation and low bank deposit rates are making even the better-off folks find it difficult to save money for the rainy day. Perhaps it is time for the state machinery to step in and ease the pain.

The government has enough reserves to take the albatross off the citizens’ neck. Milking the honest, tax paying middle class beyond a point will lead to distress. Let’s not bend it too far for it might break.

The Reserve Bank of India (RBI) must consider increasing interest rates now. Borrowers have been subsidised enough at the cost of small depositors already. A safe and lucrative investment instrument like the good old Fixed Deposit needs to continue being a viable and efficient solution for small savers.

Yes, increased interest rates are bound to suck out some liquidity and reduce consumer spending causing retail to suffer, but one would rather save for tomorrow’s needs than spend on today’s wants.

Higher interest rates will keep inflation under check too.

As far as keeping the wheels of the economy rolling are concerned, the onus should not solely rest with the middle class. The government should increase its spending on infrastructure and allied activities to keep the economic growth figures ticking.