NEW DELHI: By 2036, a more prosperous India will not announce itself through GDP figures or fiscal statements, but through the rhythms of ordinary life. It will be visible in towns where young people no longer migrate in search of opportunity but find it nearby; in homes where both parents work by choice because childcare exists within walking distance; and in MSME workshops where wages allow workers to afford the refrigerators, scooters and computers they once assembled only for others. It will show up in reliable power, clean logistics corridors, modern schools and affordable healthcare — and in homes financed through dignified incomes rather than heroic sacrifice.

For India’s top 10% — entrepreneurs, investors, builders, professionals and firms — this is not merely a moral proposition but an economic one. They can build factories, run platforms and write software, but they cannot alone generate the domestic demand required for a $12–$14 trillion economy. A prosperous middle class is indispensable for that.

The civilisational opportunity before India, therefore, is not just to grow, but to broaden who participates in that growth. Participation — not potential — is what turns nations into middle-income societies.

The lived reality behind the numbers

India today is described as a $3,000 per-capita (nominal) economy — roughly Rs 2,50,000 per person (IMF 2025 estimate). But this average conceals the distribution. A thin slice earns far above it, while the bottom half earns closer to Rs 6,000–8,000 per month ($75–100). This is why the economy feels closer to a $1,000 per-capita lived reality than a $3,000 statistical one.

The next two budgets will shape India’s transition from a $4.3–$4.5 trillion economy today into a $12–$14 trillion economy by 2036 — with or without a prosperous middle class.

The core challenge: Skewed productivity, not only inequality

India’s inequality is rooted less in failures of redistribution and more in uneven productivity. Roughly the top 10% capture 57–60% of national income, while the bottom 50% capture only 13–15%. Raising GDP without raising productivity where most Indians actually work — agriculture, MSMEs, services and small towns — simply lifts top incomes while leaving the middle stagnant.

Three levers enable productivity uplift — technology, energy and infrastructure — reinforced by one silent multiplier: women’s workforce participation.

Lever 1: Agriculture — Higher output per worker

Agriculture employs 45–46% of India’s workforce but contributes only about 16–18% of GDP. A rapid exit from farming is unrealistic; the objective must be higher income per worker. Average smallholder household income today ranges from Rs 75,000 to Rs 1,20,000 per year ($900–$1,400). Through mechanisation, digital advisory, dairy and livestock integration, and cold-chain expansion, agricultural income per worker can plausibly double to Rs 1.5 lakh ($1,800) by 2036. Reducing wastage from 20–30% to 15% and linking farmers to domestic markets would lift rural consumption and strengthen national demand.

Previous farmer-income doubling targets missed their timelines, but infrastructure built since 2018 — PM-KISAN, FPOs, ONDC, Gati Shakti and BharatNet — makes the next attempt more credible.

Lever 2: MSMEs and productivity at scale

MSMEs are central to wage distribution: they employ 110–120 million Indians and contribute 17% of GDP. Yet output per worker is roughly $7,000 — versus Vietnam at $13,000 and China at $18,000 plus. Cluster-led industrial towns, digital channels, inventory automation, reliable power via renewables and apprenticeship-based skilling can raise wages for the bottom 60% without overheating metros. By 2036, this can lift median incomes by 15–20% and add the equivalent of $300 billion to domestic purchasing power.

Lever 3: Skills to productive employment

A large workforce is an advantage only when it is employable. Manufacturing can move toward a 70% skilled workforce (from lower baselines today), services toward 60%, and agriculture toward 40% through precision and processing roles. The outcome is not simply more employment, but more productive employment.

Lever 4: Small towns and urban distribution

India’s urbanisation is metro-centric; its missing middle is the productive small town. Rather than overburden megacities, distributed urbanisation calls for 100–150 clusters of 50,000–5,00,000 population where logistics, agri-processing, MSMEs, schools, hospitals and childcare co-exist.

With urban share projected to reach 42–43% by 2036, such clusters raise women’s labour force participation, reduce distress migration and expand household consumption. Dharwad’s Blue Dots experiment, which connected 4,000 people to MSME jobs within 2 km, demonstrates that small towns can anchor opportunity rather than export talent.

Lever 5: Women and workforce participation

Female labour force participation has risen to 33–34% (PLFS 2025) but trails comparable economies. Raising it by even +8–12 percentage points to 42–45% by 2036 can add $200–$350 billion to GDP while raising household incomes by 15–20%. Small-town job density, childcare and digital platforms make this shift feasible.

Enablers: Technology, infrastructure and energy

Technology can raise sectoral output by 15–25%. Logistics costs have already fallen to 8% of GDP (2024 est.), and pushing them to 7% frees margins for farm-gate prices and MSME profitability. Distributed renewable energy provides reliability without metro-centric capex.

A civilisational window for India

India now sits within a rare demographic, geopolitical and market alignment: a young workforce, a manufacturing window, a large domestic market, rising services competitiveness and global diversification beyond China. But such windows do not remain open indefinitely. Prosperity is not an accident; it is built through the compounding of productivity, participation and dignity. If India broadens who participates in its growth, it will not only become a larger economy — it will become a more consequential society.

V Ravichandran is chairperson, eVidyaloka Trust