Need to include the middle class for inclusive growth.

"Ram Babu, who runs a hole-in-the-wall grocery store in Nateran village nestled deep inside Madhya Pradesh's Vidisha district, doubles up as a daily wager," wrote S Bera. "I have sold only three packets of biscuits over the past month and people have stopped buying soaps and shampoos," Babu said, pointing to five-rupee packs of Parle-G biscuits stacked on a shelf. In the same village, farmer Mohar Singh worries about "bank loans of Rs 500,000; soybean and pulses crop destroyed by excess rains; credit from grocery stores running over Rs 50,000 which he has to pay back with 2% monthly interest". Lunch for the two children of Rajesh Ahirwar is roti with fried green chillies. Sahab Bai has the same along with rice cooked in salt and turmeric. "Between 2011-12 and 2017-18, earnings of regular workers declined in both rural and urban areas." The collapse in demand is reflected in a slump in orders at the Peenya Industrial Area on the outskirts of Bengaluru. "Rural regular wages declined by 0.3% per annum, while urban wages declined by 1.7%," wrote Prof Himanshu. He recommends "demand injection", even if it breaches "the Center's fiscal deficit target". Some sort of Universal Basic Income (UBI) perhaps, which was promised by the Congress before the elections, but dismissed as impractical by SAA Aiyer. A modified form of UBI promises 100 days of paid employment every year to the rural population, known as the MGNREGA scheme. Rs 600 billion has been allocated to the scheme in this year's budget. The other way would be a selective 'helicopter drop', in which dollops of cash would be handed out to the needy. This has been achieved by waiving bank loans given to farmers, at a cost of trillions of rupees. "Currently, the total Central and state subsidies going for agricultural sector are estimated to be over Rs 2.2 trillion," wrote R Chand, member of Niti Aayog. All farmers are to receive Rs 6,000 per year and, just yesterday, the Prime Minister announced pensions to everyone in Jharkhand, except for taxpayers. Inflation numbers support rural distress. "For August 2019, rural food inflation is 0.9% while the urban equivalent is 6.42%," wrote R Kishore. ""Subdued inflation in rural areas suggests that incomes have collapsed and people are not being able to afford even basic items." Consumer confidence is down to zero, which is deterring people from spending, reducing tax collection and preventing the government from splashing cash to stimulate the economy. The top 1% of the population in India earned 23% of national income in 2017, same as in the US, wrote Prof K Viswanathan and A Banerjee, while France, Germany, Switzerland, Sweden, the Netherlands and Denmark have much less inequality. The difference is that these countries have strong social support for everyone while in India, the US and UK social schemes are targeted. Perhaps, that is the solution to 'inclusive growth'.