A must-have revolution: How shopping became India's new religion

The explosive growth of India's middle class has radical implications both for the global economy and for the environment. As consumers there rush to buy the new 'people's car', Andrew Buncombe counts the cost

The moment he heard the news, Satish Kumar made up his mind to start saving. For years he had been frustrated as he struggled to transport his entire family on his ageing motorbike, in all weathers and on India's chaotic roads. This "people's car" that he learnt was being advertised, would be the solution.

Less than two years later, his wish has transformed into gleaming four-wheeled reality. Last month, the 38-year-old farmer became the first person in northern India to receive a Tata Nano, the £1,250 super- budget car that some believe will revolutionise the way Indians travel.

Kumar is understandably delighted. Standing outside his farmhouse in a quiet village south of Delhi, he swells with pride as shows off his silver blue car, a "luxury" model which actually cost him £2,300. For him and his family there will no more wretched journeys perched on the 1995-model scooter, swerving in between traffic, dodging the trucks and cars. His neighbours are understandably jealous. They too want to buy a Nano.

"The biggest problem with the two-wheeler was that the entire family could not get on it at the same time," says Kumar, who lives with his wife, three children and mother. "It was not safe. Now we are all happy."

While the car promises to be Kumar's salvation, it equally carries a massive threat. India's roads are broken and inadequate, the country is overcrowded and there is a middle class of anywhere up to 300 million people who might be tempted to buy a Nano. The equation simply does not add up; the result would be chaos.

Yet the roll-out last month of this neatly-designed 625cc vehicle has implications that go far beyond India's roads. As much as any single event can do, the production of the Nano marks a potential tipping-point for the entire planet. For it is not just a car. It is a symbol of the coming-of-age of mass consumerism in the developing world.

In India, Kumar's new car is just one example of a consumer revolution that is sweeping the nation. Shopping malls are being built at a dizzying pace, each targeting a different slice of the consumer market – from the decidedly utilitarian complexes that might house a very basic supermarket and an outlet of KFC to the positively luxurious marble-floored malls of high-end designer stores, restaurants and art galleries. In 2000 there were just three such malls in India; today the estimated total is 350.

Whatever lingering image India may have as nation of ascetics, since the reforms of the early 1990s began to develop the economy, middle-class Indians have embraced consumerism with a rare passion.

Take a weekend trip to one of these malls and you will see whole families, couples and young women spending the entire day in this clean, intoxicating environment and go home laden with bags from expensive stores. On their way home, such families may well stop at traffic lights where a malnourished child (an estimated 700 million Indians still live on less than $2 a day) will be hawking copies of Vogue.

"Until 1991, many things were denied to us, so once it [the economy] opened up, the public had an appetite to discover new tastes and new needs," says Shashi Tharoor, a former UN diplomat and prolific author of books about India who now serves as the minister of state for External Affairs. "It's the classic pattern. But the consumerism of India is different to that in the West. Here we still repair things that get thrown away in the West. Here things are used for longer, they last longer."

Tharoor, whose book The Elephant, the Tiger, & the Cell Phone was a collection of essays and articles that asked prescient questions about "India, the emerging 21st-century power", is also aware of the implications of this consumer revolution for a world of finite resources. He does not go as far as to suggest that the West should limit its consumption, but he does say that the developing world should not be stopped from copying the West's example. "We are not saying that the West has to give up things, but we are saying that the West should not try and put any ceiling on what we can do."

These are more than just talking points. Already there are clashes between the West and the developing world, not simply over the plundering of its resources – something it has always happily done – but over what many consider to be the West's efforts to hold back growth. Last month, as Kumar was collecting his shiny new car, Hillary Clinton arrived in India to urge the country to start cutting carbon emissions.

After eight years of the Bush administration and its rejection of global warming science, it's unclear why Clinton thought Delhi would fall into place. Instead, it stood its ground and told the Secretary of State that it would not do anything that halted the country's economic growth – although it did promise (presumably suppressing a massive grin) to ensure that per capita emissions would never overtake those in the West. On such a basis India can continue to emit for years to come; the average citizen in the West uses 38 times as much energy as his or her counterpart in India and 140 times as much as the average person in Bangladesh.

But although the playing field is not level, and although we may take it as read that it should be level, developments such as the production of the Tata Nano raise some difficult questions. If every Indian consumer, every Chinese consumer and everyone else in the developing world has as much right to buy a car, own a TV or possess a flush toilet as someone in the West, then how should those rights be expressed? Equally, if we acknowledge that the world has only limited resources, and indeed that oil production may already have peaked, how do we make sure that what there is goes around? If consumers around the planet are to be constantly bombarded with messages encouraging them to consume and buy more, how can we hope to avoid running out?

What, furthermore, are the long-term implications? More resource wars? More inequality? More walls along the borders of countries to keep out the poor and powerless, be it the Mexicans (from the US), the Palestinians of Gaza (from Israel and the West Bank) or the Bangladeshis (from India)? Taken together, these are questions for which it is hard to find good answers.

From an office on Connecticut Avenue in the heart of Washington DC, Lester Brown, the head of the Earth Policy Institute, has been collecting and presenting overwhelmingly persuasive data about the challenges confronting the world. He and his team have also proposed solutions – about growing sufficient food, about finding alternative sources of energy about conservation and about recycling. Much of this information finds its way into the institute's treatise, Plan B, a hugely valuable piece of work that is now in its fourth edition. It is available free online.

Plan B is remarkable – and terrifying. Brown has taken the example of China, currently the world's most-populated country, and worked out the sums. On current trends, the GDP of China will equal that of the US by the year 2030. What will happen, he asks, if we assume that each member of the 1.46 billion-strong Chinese population chooses to emulate the consumption trends of their counterpart in the West?

If China consumed paper at the current US rate, then it would need twice as much paper as is produced worldwide today. If we assume China will have three cars for every four people, as there now are in the US, then to provide sufficient roads and parking spaces the government of China would have to pave an area comparable to what it now plants in rice. What's more, by 2030 China would need 98 million barrels of oil a day whereas the world is currently producing 85 million barrels a day and may never produce more. "What China is teaching us," writes Brown, "is that the western economic model – the fossil-fuel-based, automobile-centred, throwaway economy – is not going to work for China. If it does not work for China, it will not work for India."

The reason it will not work for India is that by 2032 this enigmatic, often contradictory land will have overtaken China as the world's populated nation. In an upstairs room in his simply-built home in Chittaranjan Park, a leafy area of south Delhi populated largely by Bengalis, Professor Ashish Bose, perhaps India's best-known demographer, says that while parts of India, especially in the south, have managed to control population growth, elsewhere it still soars. He highlights four states – Bihar, Madhya Pradesh, Rajasthan and Uttar Pradesh – that he terms by the acronym BIMARU. In Hindi, the word bimaru means "sick" and Bose says these four states, with their higher-than-average population growth, poor literacy and lower incomes, are holding India back.

"China had the one child policy which means it has an ageing population now. We are very youthful but growth rate is 1.4 per cent a year," he says. "By around 2050 we should have no growth. At that point the population will be 1.53 billion."

He adds: "One of the major failures of India has been in regard to literacy. In places like Bihar, illiteracy among women is as high as 33 per cent. This is directly relatable to the population problem. Thankfully, TV has come to the government's rescue. Even poor people, the slum dwellers, have TV. If you have a message, you can put it on the TV."

But the message most often put on the TV, in India as in the West, is not about birth control. It is about consumption. Even when the message is ostensibly about sex, it's usually being used to sell something. Flick on the TV at any time – but especially during a live cricket match – and the programmes are constantly interrupted by ads. Among the most popular in India are those for motorbikes (somehow always filmed in empty city streets that look nothing like the chaotic reality), cars, deodorant, skin-whitening cream (a product that has become an obsession) and mobile phones. The ads are invariably slick, clever, humorous and tempting. The advertising industry in India is worth 210bn rupees (£2.6bn).

These adverts are becoming increasingly sophisticated, just as their audience has grown more "globalised". The agencies also have an eye on international awards for their work; the glory of Cannes has become an inspiration. "There is certainly a lot more competition as there are more international brands. Also Indians are travelling abroad like crazy these days," says Arvind Bugga, chief strategist with the Delhi-based agency K Factor Communications. "I am in my fifties," he adds. "When I was young it was almost impossible to go abroad even if you had the money as there were restrictions on things like getting foreign currency. Today if a young couple gets married they are thinking about going on honeymoon to Mauritius. Everything has changed."

The statistics paint a similar picture. India is home to an estimated 84,000 dollar millionaires and 24 billionaires; 362 million people in India use mobile phones; up to 80 million use the internet; McDonald's India, home of the Maharaja Mac, reported a 35 per cent increase in sales last year.

But do all these cars, all these phones, all these holidays, all those burgers and all that whiter skin make people any happier? Of course, Satish Kumar and his family, now saved from the perils of taking to their roads on his unstable motor scooter, are delighted. But there is a substantial and growing body of work that suggests consumerism per se brings a host of new problems.

In their new book, Newspeak in the 21st Century, media critics David Edwards and David Cromwell cite American psychologist Tim Kasser, who says: "Existing scientific research on the value of materialism yields clear and consistent findings. People who are highly focused on materialistic values have lower personal well-being and psychological health than those who believe materialistic pursuits are relatively unimportant."

Kasser goes on: "Almost everyone believes that getting what you want makes you feel good about yourself and your life. Common wisdom, as well as many psychological theories, says that if we reach our goals, our self-esteem and satisfaction with life should consequently rise. However people who are wildly successful in their attempts to attain money and status often remain unfulfilled once they have reached their goal."

British psychologist Oliver James, the author of Affluenza, has identified levels of depression and anxiety among Britons that suggest between a quarter and half the population is suffering emotional distress. He believes this is connected with the pursuit of goods. "It entails placing a high value on acquiring money and possessions, looking good in the eyes of others and wanting to be famous," he writes.

In India, too, there is an awareness that chasing material wealth is not without problems. Dr Sharad Chandra, a psychologist who practices in Delhi, says many people get caught up in the pursuit of material things and that children who often suffered as a result. By contrast people with simpler lives, even those living in poverty, might not face those problems.

"[Many] people with money are trying to buy happiness. I know people who change their car every two years and are always buying all sorts of gadgets. But the children want love and affection," he said. "You often see these children growing up, drinking alcohol, having all sorts of problems. By contrast, a working person is thinking about where their food is coming from. They are not thinking about upgrading their TV system."

If this is true, why do any of us – in Europe or in India – keep on buying, particularly things that we did not know we "needed" until we got to the store? Who invented the idea of "retail therapy"? For Edwards and Cromwell, the idea is simple. To sell their products, corporations control and manipulate advertising and the media to keep consumers looking for perfection and the idea that happiness can be achieved by spending. This is as true for teenagers – increasingly filled with self-doubt and anxiety – as adults. Corporate control of popular culture is so embedded that it is hardly noticed; companies have persuaded rebellious youths to wear this or that corporate logo to look "cool". The situation is such, they write, that we are "permanently focused on ourselves, permanently dissatisfied, and permanently seeking – but, crucially, never finding – satisfaction through consumption. The natural result of this promotion of profitable dissatisfaction – 'If you only looked/dressed/lived/married/drove/ shopped/holidayed like this you would be happy' – is deep dissatisfaction with our lives."

It is unlikely that Satish Kumar – proud owner of the first Tata Nano – would accept this analysis. He lives in Narula, a village 20 miles south of Delhi and close to its satellite city of Gurgaon, a chaotic new development of office towers and modern apartment blocks that have been snapped up by a new metropolitan elite. There are constant water shortages and power cuts in Gurgaon, but there are also shopping malls and cinemas and huge hoarding boards advertising the latest consumer desirables.

Kumar's village has none of those things. It is quiet and clean and surrounded by fields of wheat, rice and lentils. Pigeons coo, buffalo are tied up outside people's homes; Kumar – whose father and grandfather were also farmers – describes his community as peaceful.

Sitting on a stool outside his one-storey home, sharing a water pipe of locally-grown tobacco with his friends, the 38-year-old agrees that India's population growth needs to be curbed. He agrees, too, that it is not practical for everyone to share in his joy and own a Nano. It is not just about who has the money to afford one, but a reflection of the fact that if everyone in India had a car there would hardly be any space to grow the sort of crops that have made Kumar quietly prosperous. "I think there would be some sort of natural disaster," he says. "Then we would be starting from zero."

Yet when he bought his car – with one cash payment since he does not believe in credit – he was not thinking of such issues. Instead, like every other consumer, he was thinking of the instant gratification: how it would help him, how it would change his life, how it would help his family. It was precisely such a thought process that the industrialist Ratan Tata had in mind when he unveiled plans for the Nano. He had been inspired, he said, by the sight of a family of four, squeezed together on the back of a motorbike, holding on for dear life and praying they would arrive in one piece.

So what does this mean for the future?

Sunita Narain, director of the Centre for Science and the Environment (CSE), an Indian think-tank dedicated to environmentally-friendly and sustainable development, admits that, when the credit-crunch broke last year, she privately hoped that people might start to question the way they had been living – the rapacious consumerism, the live-now, pay-later culture of maxed-out credit cards and mindless shopping.

"Last September CNN started talking about consumer culture. And if America can start talking about consumption ..." muses Narain. "It seemed as if we were going to reverse this mad consumerism culture. Maybe we were going to work it out. But now, with the green shoots of recovery showing, it seems to have been forgotten."

Narain says that last year, some people were even starting to ask whether GDP was the only valid way to measure a country's success and progress. People seemingly became aware, she says, that if all you measure is what a country consumes you fail to look at anything else. But as India appears to shrug off the worst effects of the crisis and confidently predicts that its economy will grow by up to 6 per cent this year, it appears – in the developing world as in the West – that things are returning to business as normal. For most commentators, the resurgence of consumerism is seen as a sign of hope for an otherwise frighteningly-fragile global economy. "Only the Bhutanese have talked about a national happiness index," laments Narain, "and no-one has taken them seriously."

Yet Lester Brown, ever the optimist, says there are things about which to be positive. Perhaps also as a result of the economic downturn, there have been small but detectable cultural shifts. Since last October, for instance, there have been more cars being scrapped in the US (14 million) than new ones being sold (10 million). For the first time, the country's total car pool is diminishing. The numbers are only small, but he believes it is a trend. Furthermore, he is convinced that the car culture of previous generations is fading. "When I was young, getting your licence and going for a drive was a rite of passage. Today young people do not look forward to it in the same way," he says.

At the same time, there has been a slow awakening as to the wealth of renewable energy available if only resources and investment were set aside to harnessing it. Brown launches into a staccato-list of recent developments in the renewable sector; in the last 18 months, around 20 solar power plants have opened in California and Arizona, providing a total of 6,000 megawatts of power, while Algeria has agreed a deal with Germany to provide solar energy using powerlines that will pass under the Mediterranean.

"Algeria has said it has enough solar energy to power the world's economy. It sounds loopy but it is not," he enthuses. "The amount of solar energy hitting the surface of the planet in one hour is sufficient to power the word's economy for a year."

And there, believes Brown, lies part of the solution to the seemingly insoluble problem. If we are unable to tear ourselves away from our consumer-orientated lifestyles, unable to ignore the corporate machine urging us to spend more and more, then we need to find a different means of providing for it. For India, which unlike China and the US has little access to wind power, this might mean harnessing the potential of the north-western desert of Rajasthan.

Brown envisages a time when India becomes a pioneer in solar technology and transforms the large, sparsely-populated areas of the Rajasthan desert into a vast solar farm. "If you look at the desert in the north-west, there could be more than enough energy for the Indian economy," he says. "When I look at India I see the potential to build mirrors and turbines."

This would only be part of the solution, of course, but Brown insists that something needs to shake us from the path we are currently fixed on. He is fond of quoting a comment from the scientist Amory Lovins, head of the Rocky Mountain Institute, a US foundation that focuses on sustainability and the marketplace.

Asked by a journalist how people could be forced to think "outside the box", Lovins replied: "There is no box."

India: in figures

* KFC yesterday announced plans to more than double the number of its restaurants in India from 50 to 110 by the end of next year

* Nearly half of India's population – about 456 million people – live on less than $1.25 a day, according to the World Bank

* McDonald's India, home of the Maharaja Mac, reported a 35 per cent increase in sales last year and plans to employ 12,000 new staff by 2015

* 362 million Indians use mobile phones, of whom almost 30 per cent live in rural areas. Farmers in Gujurat are testing "Nano Ganesh", a system that enables the remote control of irrigation pumps

* India's advertising industry is worth £2.6bn

* India is home to an estimated 84,000 dollar millionaires and 24 billionaires. Last June saw the launch in Mumbai of the Supercar Club of India, the first of its kind in the country

* When it launched in 2007, 'Vogue' India sold 50,000 copies, with a 300,000 target readership. Adverts cost up to $10,000 for a page

* India's online population – currently estimated to be between 50 million and 80 million – is expected to be the world's third biggest (behind China and the US) by 2013