October 14, 2008 / 12:16 AM / 9 years ago

Luxury mall showcases wealth gap in India

By Krittivas Mukherjee NEW DELHI (Reuters) - With gold-plated ceilings, exotic fountains and the clink of champagne glasses, the Emporio Mall in New Delhi is the perfect place to wile away a hot afternoon browsing through designer boutiques.

<p>Employees adjust products inside their showroom at the Emporio mall in New Delhi September 9, 2008. REUTERS/Adnan Abidi</p>

The mall, adorned with palms and scented with lavender, is the exclusive playground of India’s rich, which despite the effects of the credit crisis still have plenty of cash to buy designer accessories with thousand dollar price tags.

Getting access to this little piece of air conditioned paradise amid the hustle and bustle of the sweltering capital will cost $5. That’s about one week’s salary for 80 percent of India’s billion plus population.

With a phalanx of security guards keeping out the destitute and a pricey admission fee, some social observers see India’s first luxury mall as a symbol of an economic apartheid that they say increasingly divides the ‘haves’ and ‘have nots’ in India.

“The conditions, the ground conditions are not like those of Western cities,” said Satish Deshpande, professor of sociology at the Delhi School of Economics.

“So, we are tending more and more toward a kind of apartheid, a kind of separation that is very sharp and sharply visible in our cities, in gated communities.”

The widening wealth gap has major implications for India, which faces a general election next year, and has been plagued by waves of violence in its provinces that analysts say is at least partly due to the socioeconomic divide alienating segments of society.

The issue is likely to play a central role in next year’s general election in which Prime Minister Manmohan Singh’s Congress party will seek re-election.

The party took power in a coalition government four years ago on a platform of more ‘inclusive growth’ for India’s ‘have nots’, a promise upon which it has mostly failed to deliver.

Asia’s third-largest economy has grown nearly 9 percent a year over the past four years, driven largely by consumer demand from the middle-class and soaring foreign investment. Despite the boom, official data shows an estimated 800 million of India’s billion-plus people live on 50 U.S. cents a day.

The top 10 percent of India’s population owns between 33 to 50 percent of the country’s wealth, according to a range of estimates by the government, think-tanks and academics.

Uneven economic growth is posing a serious security threat to India, Singh said last December, pointing out that a large proportion of recruits for militant groups came from regions untouched by India’s scorching growth.

NO EUPHORIA FOR INDIA‘S POOR

While the middle and wealthier English-speaking classes are profiting from an economic surge, it is unclear how well this is trickling down to hundreds of millions of Indians living in small towns and rural areas.

Analysts say the failure to deliver social justice and development to India’s poorest regions have alienated people and helped open up economic, social and religious divides.

Socio-economic divides and governmental apathy are said to fuel some of India’s deadliest insurgencies in which thousands of people have been killed, including a four-decade-long Maoist rebellion and several armed movements in the remote northeast.

<p>A customer enters a showroom at the Emporio mall in New Delhi September 9, 2008. REUTERS/Adnan Abidi</p>

A contest for jobs and development is in part the reason for a violent Hindu-Christian conflict raging in the country’s east.

“These divides and disparities lead to disaffection, large-scale migration and discord,” Singh said last year at a meeting of state chief ministers, drawing a rare link between economic inequality and internal security by a top government leader.

“In many cases internal security problems arise out of uneven development and we need to address this issue if we are to make any long-term headway in combating extremist elements,” he said.

A government panel report last year on the informal sector said the buoyancy in the economy lead to a sense of euphoria at the start of this century.

“However, a majority of the people, who did not have even Rs. 20 a day for consumption, were not touched by this euphoria. At the end of 2004-05, about 836 million or 77 per cent of the population were living below Rs.20 per day,” it said.

GATED COMMUNITIES

Slideshow (5 Images)

Inside the Emporio mall, the sybaritic grandeur is a sharp contrast to the grinding poverty of the Yamuna Pushta slum, one of New Delhi’s most notorious, where the stench of raw sewage wafts from open sewers and barefooted children play in the dirt.

Visitors to the mall are greeted by porters who swing open glass doors leading into two huge oval atriums decorated with crystal chandeliers, fountains and pillars. The fittings on the three floors are burnished wood, etched glass and brass.

The mall sprawls over 32,500 square meters (350,000 sq ft) of retail space. It houses scores of exclusive brands such as Cartier, Dior, Jimmy Choo, Zegna, Chopard and Dolce and Gabbana.

Given India’s rapidly expanding millionaire base, it is hardly surprising the country has emerged as a delectable destination for luxury brands, which until the mall opened were mostly sold in small boutiques in luxury hotels.

Retail consultant Technopak estimates that some 1.8 million households in India earn $100,000 or more a year, spending a tenth of that on luxury goods.

This adds up to a potential market of $18 billion, a figure that is expected to rise to $56 billion by 2012, assuming the financial crisis does not make too big a dent.

When India gained independence in 1947, the country embraced a socialist ethos where extravagance was looked down upon. That has changed with the freeing up of the economy since 1991.

The bullish embrace of ritz has made India’s social divide starker.

The most coveted things in the world are as easily available here as the basic necessities of life are denied to a vast majority of its people. And perhaps no-where more so than inside the Emporio mall where an unabashed celebration of luxury is on full display.

Suresh Garg, a rotund businessman shopping at the Emporio, embodies the spirit of the new, hedonistic India.

“We have been pushed around for far too long - a Third World country,” he said. “But now we have arrived. Now we are no less than anyone and we need to show it off.”

Additional reporting by Sunil Kataria and Rina Chandran; Editing by Megan Goldin

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