To find the Indian city with highest monthly household income, people from Delhi, Mumbai and Bangalore will have to travel to Surat.
More India business stories
The diamond city has registered the highest growth rate (16%) during 2004-08 in the average household income category. Ahmedabad comes third with a growth rate of 14% for the same period.
And if that wasn’t enough Surat is also the city with the highest average household income. Business capital of Gujarat, Ahmedabad comes fifth in terms of average household income.
“What it essentially means is that it will be difficult for any other city to outdo Gujaratis,” says Rakesh Shukla, researcher at New Delhi-based National Council for Applied Economic Research (NCAER).
Shukla has co-authored the report titled, 'The Next Urban Frontier: Twenty Cities to Watch’ with Future Capital Research’s Roopa Purushothaman, who had authored the BRIC 2050 report.
The report throws up several interesting facts about growth of top 20 Indian cities and the demographics therein. The report divides the 20 cities in three main categories. Megacities: Mumbai, Delhi, Kolkata, Chennai, Bangalore, Hyderabad, Pune and Ahmedabad. Boomtowns: Surat, Kanpur, Jaipur and Bhopal Niche cities: Faridabad, Amritsar and Chandigarh.
Surat and Ahmedabad make interesting case studies for economists, as even though they are not on top in several parameters they have shown substantially high growth.
The average household income of Surat, adjusted for cost of living in the city, is around Rs 4,57,671, while the same in Chandigarh is Rs 4,22,503, Mumbai Rs 4,03,059 and Delhi 3,37,678, followed by Ahmedabad at Rs 3,28,267.
Interestingly, these numbers reflect that the diamond capital of India along with political and trade capitals of the country have per capital income well over double the estimates for national GDP per capita.
The research also shows that Surat’s middle class has more than doubled between 2004-05and 2007-08, while the low income category has shrunk by over a third.
The future of the city looks even better when one considers the fact that Surat is close to being a megacity with a young population.
Over 64% of the population is below the age of 30. The city is already a larger consumer market than Ahmedabad and Pune, says the report. In addition, the report points out that the two Gujarati cities are again on the top when it comes to life insurance penetration and in the middle as far as credit card penetration is concerned.
More India business stories
However, when it comes to spending propensities in these 20 cities, Surat and Ahmedabad are at the lower end of the spectrum. "This is partially because cost of living in Gujarat cities is lower, which demands less expenditure on household consumption," says Shukla.
Under license from www.3dsyndication.com