x Abu Dhabi, UAEWednesday 26 July 2017

New Indian rich's show of wealth leaves a bad taste

India's rising nouveau riche are splashing the cash, illustrated by the nation's most expensive wedding at $22 million. However there is increasing concern over the divide between rich and poor.

Newlyweds Yogita, third left, and Lalit Tanwar, third right, with family members at their wedding, where guests all received a biscuit made of silver and a fat, cash-stuffed envelope.
Newlyweds Yogita, third left, and Lalit Tanwar, third right, with family members at their wedding, where guests all received a biscuit made of silver and a fat, cash-stuffed envelope.

The bridegroom wore a shimmering tunic, a bejewelled turban and a garland of crisp bank notes.

He planned to arrive at his wedding in style - saddled not on a dappled white horse like most Indian grooms, but in a helicopter. It was a new Bell 429, a dowry gift worth US$8 million (Dh29.3m) from the bride's family.

It circled for several minutes above the wedding tent - a replica of a Hindu maharaja's palace, packed with 18,000 guests, who waved and waited for it to land on a makeshift helipad. But much to their dismay, bad weather forced the helicopter to retreat. The groom eventually arrived, late for the nuptials, in a BMW.

But the wedding last month was still one to remember. There were svelte Bollywood dancers, Punjabi pop musicians and a lavish buffet spread. The guests all received a biscuit made of silver and a fat, cash-stuffed envelope.

Amid such pomp and pageantry, Lalit Kanwar and Yogita Jaunapuria - both 26 and from upwardly mobile families belonging to India's Gurjar community - were married last month at a farm estate outside Delhi. This affair, which cost an estimated $22m, will be remembered as the most expensive wedding in India's history.

This ostentatious display of wealth caused the chests of many Gurjar community members - traditionally farmers and nomadic shepherds - to swell with pride.

It was widely seen as a sign of growing confidence among the tribe's nouveau riche - a new monied class that harvested a vast crop of wealth in recent years from the sale of farm land, the value of which has steeply appreciated amid the growing urbanisation and industrialisation in India.

Much of this land is bought by property magnates and business houses to build posh residential towers or set up industries outside big, congested cities such as Delhi. The land deeds, in some cases, created new pockets of wealth overnight.

Once known for their austerity, this new economic class is steadily embracing a new ethos of extravagance. In some villages abutting Delhi, mud-and-clay houses are now replaced by sandstone mansions and high-gated estates. Streets once riddled with bullock carts and water buffalo are now found packed with Audis, Mercedes and Porches.

And, yes, the arrival of grooms on helicopters is fast becoming a common fixture at weddings.

"We splurge because we can," said a relative of Mr Kanwar, who did not wish to be identified. Intense scrutiny of the wedding in recent weeks has prompted the family to avoid the press. "India will remember Lalit and Yogita's grand wedding. The world will remember Lalit and Yogita's grand wedding."

But this kind of extravagance is also causing much heart searching.

Some community elders worry such displays of wealth could provoke resentment among the landless poor who have been unable to ascend the economic ladder. There are also concerns about one-upmanship within the community. Some of the community's wealthy are going head over heels to outdo each other in terms of extravagance at social events.

In Jaunapur village, from where Ms Jaunapuria hails, community members have recommended restricting the number of guests at weddings to 100 each from the bride's and groom's side and limiting cash gifts to 101 rupees (Dh8.35). They also want to ban the use of firearms and disc jockeys.

The rules are currently being considered by the mahapanchayat, a consortium of local village councils. If approved, those who do not obey the new rules will face social boycott.

At the national level, too, the government is mulling a proposal to limit the number of guests invited to weddings and the number of dishes served.

KV Thomas, India's food minister, said last week such a proposal was necessary to curb high consumer price inflation, currently at 9 per cent, the third highest among the Group of 20 leading and emerging economies. He estimated up to 30 per cent of food at weddings was wasted.

"Lavish weddings divide society," Prakash Javdekar, the spokesman for the Hindu nationalist Bharatiya Janta Party, told Bloomberg News last week. "It creates a division between the rich and poor. We need simpler weddings."

Despite growing prosperity, about 40 per cent of India's 1.21 billion people survive on less than $1.25 per day. Wealth in the country is increasingly concentrated in the hands of a few.

The country is home to more dollar millionaires and billionaires than any other country except the US and China. The concentration of wealth among India's 55 richest men - who have an average net worth of $4.5 billion and a total net worth exceeding $300bn - grew from 0.8 per cent of GDP in 1996 to 23 per cent in 2008. The number of high-net-worth individuals - people with assets exceeding $1m - has grown to 130,000 from 84,000 in 2008.

But the country's per capita income - which has doubled in the past two decades to about $1,050 - has not grown at the same pace.

Michael Walton, a professor of economics at Harvard University, says the problem is not with India's rate of GDP growth but the quality of growth and its distribution - which he says is structurally "disequalising".

Prof Walton questions the social utility of the concentration of wealth in the hands of a few. He predicts that with growing disparities, societal pressures for a wider distribution of wealth will mount in the coming years.

A report published last year by the Asian Development Bank starkly pointed out income inequality in Indian society had worsened since economic reforms began in 1991.

Between 1993 and 2005, the Gini coefficient in India jumped from 0.343 to 0.378 in urban areas. The coefficient, a measure of inequality, is a value between 0 and 1 that quantifies a nation's inequality in consumption or income. A lower coefficient indicates more equitable distribution of income and consumption, with 0 denoting absolute equality and 1 indicating an extreme degree of inequality.

Sonia Gandhi, the president of India's ruling Congress party, has frequently exhorted government functionaries to avoid "vulgar" displays of wealth. Two years ago, she started an austerity drive in the government, asking officials to cut down expenses by travelling economy class, slashing phone bills and judiciously using government cars.

Kanwar Singh Tanwar, the father of Lalit Tanwarand a member of the Congress party, was criticised heavily by party colleagues for organising the extravagant wedding for his son despite Mrs Gandhi's repeated requests. He was the wealthiest politician to contest the 2009 parliamentary elections. His declared net worth exceeds 1.55bn rupees.

 

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