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Interesting stuff. We go to China every year or so, and it's always an adjustment spending time in a place like Beijing and Shanghai. I haven't been to India, but I've been told the density is even higher. I think one way that humans cope is that they carve out a place of refuge, even if it just a small studio apartment. Even in crowded cities, people can get a significant time with little contact.
I do have to wonder what the effect in over-crowded prisons is though. Imagine this existence: http://i.imgur.com/owvao.jpg