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We can potentially achieve high-income status by the late 2040s, but this requires sustained annual per capita GDP growth of at least 9%. This will be hard to achieve without higher female workforce participation, faster capital formation through improved credit access, and prioritizing productivity gains via significant investment in indigenous technology. Fostering a high-trust society and increasing risk appetite are crucial for this ambitious goal. This article 'How rich must Indians be for India to be called developed?' appeared as a column by Neelkanth Mishra in The Times of India on 2 July 2026.
Over millennia philosophers have struggled to clearly answer the question ‘who is rich?’ A useful metric, easy to measure as well as compare, is income. The somewhat subjective factors that affect happiness (Good health? Freedom? Control of one’s time? Leisure?) also correlate well with it: People in high income countries also tend to have more leisure and better health, for example.
The most widely followed categorization of countries is by the World Bank and uses a per capita nominal GDP threshold of US$14,000 for high-income status. This was fixed at US$6,000 in 1987 prices, and has risen at around 2% annually since then, broadly tracking developed-economy inflation. 85 countries (around 40% of those ranked) were classified high-income in 2024.
Per capita GDP is not a perfect measure. First, it ignores income distribution within a country. If income is concentrated in the hands of a few, even if the mean per capita income is high, many people would be poor. One can track median income, which is the middle-value when incomes are lined from smallest to largest. If there are too many poor and very few rich, the median would be lower than the mean. We note though that the gap between them tends to narrow significantly as economies become prosperous.
Second, consumption may better indicate material well-being and differs from income, as savings, the gap between income and consumption, vary between economies, and between the rich and the poor. Some researchers even adjust for leisure and life-expectancy to arrive at ‘consumption-equivalent welfare.’ However, this is hard to measure and compare accurately and frequently.
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