Spending is no longer confined to the rich. The middle class, brought up traditionally on the ideals of simple living, has learnt to splurge. The term conspicuous consumption has gone out of fashion. Consumption now has to be conspicuous. While the government fights poverty with growth, its early beneficiaries are now high up on the luxury ladder. From classy crystal ware to cognac for connoisseurs, from handcrafted carpets to opulent diamonds, a range of luxury goods is available now, nurtured by homegrown entrepreneurs and foreign labels lining up to address aspirants and old-world buyers.

Indians are used to certain luxuries anyway like a servant or several at your beck and call, vegetables and fruits year round (no tinned food), tailored garments, silks and cottons at prices unbelievable in the West, and the pleasure of writing with a fountain pen. Yet, there is that thirst for more. The term freedom from want was coined in the context of the poor. But for the middle classes, this freedom may never come. Today generation notices the beggars while walking down the street, and feels guilty. You had better be politically and socially correct. But the gen-next or gen-now is neutral to riches on one side and squalors on the other. You stretch your feet as far as the sheet covers them, goes an old Indian saying.

Indians seem to be living way beyond their means. More and more households seem to be borrowing, not for creating assets like a house or a car but to meet consumption needs ranging from food, transport and medical bills to even repaying loans. Consumers using credit facilities, probably credit cards, for purchasing fuel and renovating their houses constitute the biggest chunk of the borrowings. The trend towards urban India’s transformation into a consumerist society, with diminished stigma associated with debt. Thus, while the housing loan business may be big in terms of value, in terms of loans it is still for the odd house renovation or to buy jewellery for a wedding. Also, while banks may be pestering you with calls offering a variety of loans, many urban households don’t mind tapping the much-maligned moneylender or friends and relatives to borrow for routine expenses.

Though only 7.2 per cent of urban households borrow from moneylenders, compared to nearly 21 per cent in rural areas, the figure is significant because of the widening institutionalized credit bouquet. For Indian households, food makes up over half the household budget, followed by transport and education. Spending patterns in urban and rural India are more or less similar, with education being the only major point of difference. The motto for today’s generation is that if you have it, flaunt it. A happy yet less celebrated part of the story is the demand it triggers for traditional artisans and craftsmen in leather, porcelain, silk, gold and crystal. Indian craftsmen such as brass workers now contribute to French fashion.

In comparison, China and Russia  the two other emerging markets where the luxury brands are seeing huge market potential have a stronger preference for foreign brands Wearing a brand name tells the world and yourself that you have arrived.