WHAT HAPPENED TO THE GREAT INDIAN MIDDLE CLASS?

One theme ran through the just concluded Q2 earnings season—urban India is showing signs of distress

- Abhishek Mukherjee

Just across the road from the ruins of the massive Tughlaqabad Fort in South Delhi lies a beautifully preserved sandstone-and-marble tomb. The mausoleum, built in the early 1300s, belongs to Ghiyasuddin Tughlaq, founder of the Tughlaq Dynasty of the Delhi Sultanate.

Ghiyasuddin's life was a revved-up version of the classic rags-to-riches tale. He started off as a menial servant at a merchant's house, spent a considerable time in Delhi looking for a job, before managing to find employment in the royal army, where he steadily rose through the ranks and eventually became powerful enough to dislodge the squabbling heirs of the sultan.

Of course, this fairytale life was also accompanied by immense brutality, casual bigotry and other assorted virtues characteristic of medieval kings, but what set him apart from most of his peers was his administrative stance.

Having risen from the common people, Ghiyasuddin was acutely aware of their problems. But more importantly, he sympathized with them. His policymaking sought to strike a fine balance between the state's interests and the masses' welfare.

For instance, he not only substantially reduced the tax burden imposed by the previous sultan but also remitted taxes during years of drought, while simultaneously undertaking infrastructural projects like digging more irrigation canals and building forts in the countryside to shore up security.

He also issued an astonishingly modernist macroeconomic edict. Excessive taxation and the exorbitant demands of kings can be detrimental to progress, Ghiyasuddin told his revenue officers.

Perhaps there is no group among which this message would resonate more strongly at the moment than India's middle class.

CORPORATE CUES If there was one theme running through the just concluded Q2 earnings season, it was that urban India is showing signs of distress.