Can India avoid the middle-income trap?

Five key course corrections for India to become an advanced country and set a better path for others

- AJAY CHHIBBER

The World Bank's latest World Development Report says about 108 countries* are currently stuck in a middle-income trap. It defines these as countries with a gross national income (GNI) per capita between $1,146 and $14,005 in 2024—below this threshold, a country is considered low-income, while above it, high-income. It breaks up the middle-income category (MIC) into two sub-categories—with those between $1,146 and $4,515 as lower middle-income (LMIC) and above that as upper middle-income (UMIC).

The number of countries in the MIC group remained high at about 90 in 2000, increasing to 109 in 2010, and remaining at 108 today. They appear to be in a trap. But this is misleading.