Dev 360 | Affordability, Not Identity, Real Crisis In India’s Cities | Patralekha Chatterjee

Delhi is grieving. A horrific blast near the historic Red Fort has so far claimed 13 lives, injured many more, and shattered the city’s sense of safety once again. Investigations are on. In moments like these, everything else can feel secondary -- and rightly so. But even as we mourn, we must also reckon with another kind of violence: the slow, invisible kind that unfolds in homes across urban India every day -- a cost-of-living crisis that is tightening its grip on millions, pushing families into debt not for luxuries, but for survival.

The urban poor have always lived on the edge, but now even the lower middle class and middle class are feeling the squeeze. Rent, groceries, school fees, transport and healthcare consume such a large share of household income that salaried professionals are borrowing just to stay afloat. The crisis is no longer looming -- it has arrived.

Eminent economist Ajit Ranade laid out the numbers with stark clarity in a recent commentary in national dailies -- India’s households, long regarded as cautious savers, are quietly taking on record levels of debt, he noted. Citing the Reserve Bank of India’s Financial Stability Report, he pointed out that household debt in India had reached 42 per cent of the GDP at the end of 2024, up from just 26 per cent in 2015.

People are borrowing faster than they are earning, pushing up financial risk.

Significantly, about 55 per cent of this borrowing stems from non-housing retail loans such as credit card dues, personal loans, auto loans and gold loans, while traditional home loans make up only about 29 per cent of total household debt.

Unpack this and the starkness of the situation comes into focus -- more of household borrowing is just to make ends meet rather than to build assets. Middle-class and lower-middle-class families, traditionally frugal, given to setting aside money for children’s education or a roof over their head or some sort of financial cushion for a rainy day, are borrowing to spend on current consumption.

“The cost of urban living is rising, and debt has become a coping mechanism. The other worrying phenomenon is the decline in the financial savings of households,” notes Dr Ranade.

Clearly, the problem as Dr Ranade and other experts have pointed out, is not that Indians are borrowing but the purpose of the loans. They are not always taking loans to buy a house or to set up businesses, in short, creating assets. More Indians are using credit simply to pay for daily expenses.

A key trigger for the rising household debt is the rise of credit card usage. Credit card defaults are going up. Indians are defaulting on credit cards due to a host of reasons, including the easy availability of credit, high interest rates on unpaid balances, and a lack of financial literacy. Aggressive lending practices have led to impulsive spending and debt traps, while a lack of understanding about timely payments and high-cost debt can make it difficult to keep up with payments, particularly for younger and less-experienced borrowers. This is happening at a time when incomes are not going up proportionately.

The Household Consumption Expenditure Survey (2023-24) shows that non-food expenses now dominate household budgets.

Rents continue to be very high in India’s megacities. Food takes up a large chunk of the income. And for millions of part-time and low-wage workers, even commuting to work is costly. In cities like Delhi-NCR, Bengaluru, and Hyderabad, daily travel can cost anywhere from Rs 1,500 to Rs 7,000 per month according to media reports.

Given all this, why is the affordability crisis not the top-most political issue in India?

In New York City, Zohran Mamdani just won the mayoral election by doing what Indian politicians in power refuse to do: naming the crisis. His campaign was built around the material realities of working-class New Yorkers -- rent freezes, universal childcare, free public buses, city-run grocery stores and higher taxes on the wealthy. Mr Mamdani’s identity helped mobilise historic turnout among underrepresented groups, but it was his economic messaging that really resonated in New York, the financial capital of the world’s most powerful country. Mr Mamdani spoke directly to the pain of his constituents and laid out a clear agenda for change.

Meanwhile, in India, Zohran Mamdani’s victory was framed almost entirely in relational and identity terms: the first Muslim and South Asian to lead America’s financial capital, son of a celebrated filmmaker and a top academic, eating biryani with his hands. What is less visible in the public discourse around him is the core of his campaign: a bold, unapologetic focus on affordability.

India does not need to copy Mr Mamdani’s agenda or template in toto. Our cities have their own realities, constraints and political cultures. What we need to learn from Mr Mamdani, and from the voters who elected him, is the honesty of his campaign. He named the crisis. He initiated a conversation. And he made affordability central to the political agenda.

Zohran Mamdani has a daunting task ahead. He will face challenges. Governing is harder than campaigning. But he has already done something which India’s urban politics needs to learn from: he has made the cost of living a legitimate, urgent and central issue. He has treated economic pain not as a private burden, but as a public concern.

Candidates who speak plainly about rent, food, fuel, and wages are resonating with voters across the world. Mr Mamdani’s campaign worked because it told a story of dignity, fairness, and possibility. It made affordability feel like a fight worth joining. Zohran Mamdani is not alone. In the same 2025 cycle, Abigail Spanberger in Virginia and Mikie Sherrill in New Jersey also won by focusing on affordability.

The real crisis in India’s cities is not identity – it’s affordability. No one expects miracles or overnight cures. But the first act of courage is to end the denial. Politicians see rural hunger as poverty: urgent, vote-worthy. They see urban EMI traps, grocery shocks, and medical bills as middle-class discomfort: optional, ignorable. The reality: it’s not either-or. India is rapidly urbanising. Over 30% of Indians live in cities and towns. That figure is projected to grow to around 40% of the population by 2030. The urban working class isn’t asking for charity. They are demanding recognition: that their fight for survival is just as real, just as political. Until leaders stop whispering about just “aspirations” and start shouting about rent, food, fuel and futures, the conversation stays broken. Affordability can be a winning battle cry.