Inequality in India: what's the real story?
- Private Sector Engagement
- by Nisha Agarwal
- 05 Oct, 2016
India is suddenly in the news for all the wrong reasons. It is now hitting the headlines as one of the most unequal countries in the world, whether one measures inequality on the basis of income or wealth.
So how unequal is India? As the economist Branko Milanovic says: “The question is simple, the answer is not.” Based on the new India Human Development Survey (IHDS), which provides data on income inequality for the first time, India scores a level of income equality lower than Russia, the United States, China and Brazil, and more egalitarian than only South Africa.
Inequality in numbers
According to a report by the Johannesburg-based company New World Wealth, India is the second-most unequal country globally, with millionaires controlling 54% of its wealth. With a total individual wealth of $5,600 billion, it’s among the 10 richest countries in the world – and yet the average Indian is relatively poor.
Compare this with Japan, the most equal country in the world, where according to the report millionaires control only 22% of total wealth.
In India, the richest 1% own 53% of the country’s wealth, according to the latest data from Credit Suisse. The richest 5% own 68.6%, while the top 10% have 76.3%. At the other end of the pyramid, the poorer half jostles for a mere 4.1% of national wealth.
What’s more, things are getting better for the rich. The Credit Suisse data shows that India’s richest 1% owned just 36.8% of the country’s wealth in 2000, while the share of the top 10% was 65.9%. Since then they have steadily increased their share of the pie. The share of the top 1% now exceeds 50%.
This is far ahead of the United States, where the richest 1% own 37.3% of total wealth. But India’s finest still have a long way to go before they match Russia, where the top 1% own a stupendous 70.3% of the country’s wealth.
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Why does it matter?
Oxfam believes that this sharp rise in inequality in India – and in many countries around the world – is damaging, and that countries need to make an effort to curb it. Rising inequality will lead to slower poverty reduction, undermine the sustainability of economic growth, compound the inequalities between men and women, and drive inequalities in health, education and life chances.
For the third year running, the World Economic Forum’s Global Risks Report 2016 has found “severe income disparity” to be one of the top global risks in the coming decade. A growing body of evidence has also demonstrated that economic inequality is associated with a range of health and social problems, such as mental illness and violent crime. This is true across both rich and poor countries. Inequality hurts everyone.
What can India do to reduce inequality?
The continued rise of economic inequality in India – and around the world – is not inevitable. It is the result of policy choices. Governments can start to reduce inequality by rejecting market fundamentalism, opposing the special interests of powerful elites, and changing the rules and systems that have led to where we are today. They need to implement reforms that redistribute money and power and level the playing field.
Specifically, there are two main areas where changes to policy could boost economic equality: taxation and social spending.
1. Progressive taxation, where corporations and the richest individuals pay more to the state in order to redistribute resources across society, is key. The role of taxation in reducing inequality has been clearly documented in OECD and developing countries. Tax can play a progressive role, or a regressive one, depending on the policy choices of the government.
2. Social spending, on public services such as education, health and social protection, is also important. Evidence from more than 150 countries – rich and poor, and spanning over 30 years – shows that overall, investment in public services and social protection can tackle inequality. Oxfam has for many years campaigned for free, universal public services.
Two key indicators are: how much has a government committed to spend on education, health and social protection? And how progressive are the spending levels? This chart shows the money India has spent on public services over the past eight years; the horizontal lines represent expenditure as a percentage of GDP, and vertical bars expenditure in rupees.
Image: Economic Survey 2014-15, Statistical Appendix, Government of India
According to a forthcoming Oxfam report (to be published in 2017), India performs relatively poorly on both counts. Its total tax effort, currently at 16.7% of GDP, is low (about 53% of its potential) and the tax structure is not very progressive since direct taxes account for only a third of total taxes. South Africa, by comparison, raises 27.4% of GDP as taxes, 50% of which are direct taxes.
When it comes to the second indicator (levels and progressivity of social-sector spending), India compares less well. Only 3% of GDP goes towards education and only 1.1% towards health. South Africa spends more than twice as much on education (6.1%) and more than three times as much on health (3.7%). While it’s assessed as more unequal than India, South Africa rates much higher than India in its commitment to reducing inequality.
The dream of ending poverty
Oxfam has calculated that if India stops inequality from rising further, it could end extreme poverty for 90 million people by 2019. If it goes further and reduces inequality by 36%, it could virtually eliminate extreme poverty.
India – along with all the other countries in the world – has committed to attaining the Sustainable Development Goals by 2030, and to ending extreme poverty by that year. But unless we make an effort to first contain and then reduce the rising levels of extreme inequality, the dream of ending extreme poverty for the 300 million Indians – a quarter of the population – who live below an extremely low poverty line, will remain a pipe dream.
Written by: Nisha Agrawal, CEO, Oxfam India
Photo credit: REUTERS/Rupak De Chowdhuri
Source: World Economic Forum
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The changing world of humanitarian work
Sep 10, 2019 | ursila
Can India be a Leader in Disaster Risk Reduction Measures in Asia?
Oct 7, 2019 | ursila
A struggle for survival: Assam Floods
Nov 11, 2019 | Anisha
Lessons to be learnt from the Gorakhpur tragedy
Oct 24, 2019 | ursila
Is Section 498A anti women?
Nov 11, 2019 | ursila
The Irresistible & Oppressive Gaze: A Survey Report by Oxfam India
Oct 24, 2019 | oxfamadmin
North East Floods: How you can help those affected?
Oct 1, 2019 | Ravi
Oxfam is responding in Assam Floods 2017
Oct 1, 2019 | Ravi
Lipstick Under My Burkha Official Trailer - Winner of Oxfam's Best Film on Gender Equality Award
Sep 27, 2019 | Ravi
Sourcing Life
Oct 7, 2019 | Anisha
MEETING TOILET TARGETS
Oct 7, 2019 | oxfamadmin
Disaster Changed Her Life
Oct 24, 2019 | Anisha
#HaqBantaHai Campaign on Access to Free Medicine: Bihar
Sep 10, 2019 | Anisha
Be The New Norm
Oct 7, 2019 | Ravi
Oxfam India’s Recommendations for National Policy for Women
Sep 27, 2019 | Ravi
The Greatest Earning: EDUCATION
Dec 5, 2019 | Anisha
Women Farmers or Labourers?
Oct 24, 2019 | Avantika
Farewell Dirty Water
Jan 9, 2020 | Avantika
Clean Water Can Save Lives
Oct 24, 2019 | Avantika
Making men an ally on women's rights
Oct 24, 2019 | Avantika
'Initially the men opposed. They thought we women were being disruptive.'
Oct 1, 2019 | Avantika
Tax havens resist reforms one year on from Panama Papers exposé
Oct 1, 2019 | Avantika
इख़्तियार
Oct 24, 2019 | Avantika
Lessons from the Grassroots
Sep 10, 2019 | Avantika
This is What Child Marriage Looks Like
Nov 18, 2019 | Avantika
Oxfam India Held Youth Festivals In Lucknow And Raipur
Sep 9, 2019 | Avantika
Oxfam at the North-East Disaster Risk Reduction Conclave 2017
Sep 9, 2019 | Avantika
Finding Solutions to Early and Forced Marriage
Sep 27, 2019 | Avantika
Silence Has No Honour
Sep 27, 2019 | Avantika
Solidarity Is Our Weapon- The International Women’s Strike
Oct 24, 2019 | Avantika
4 reasons why Oxfam supports the International Women’s Strike on the 8th March
Oct 24, 2019 | Avantika
Union Budget 2017-18: Neglected Social Sector
Sep 10, 2019 | Avantika
Putting Data at the Heart of Business Responsibility
May 13, 2019 | Avantika
Mainstreaming DRR in Local Development Plans to Reduce Aid Dependency
Oct 1, 2019 | Avantika
Union Budget 2017-18: A Look at the Health Sector
Apr 5, 2019 | Avantika
खेल - जेण्डर आधारित असमानताओं को उजागर करने को एक सषक्त माध्यम
Apr 5, 2019 | oxfamadmin
Why Brazil should not take a U-turn on its health system
Oct 7, 2019 | Avantika
Your questions answered: Oxfam’s Inequality report
Oct 1, 2019 | Avantika
Unpacking the Risks of Doing Business in India
Nov 14, 2019 | Avantika
We Never Learn
Sep 27, 2019 | Ravi
Promote men’s involvement for changing social norms
Oct 24, 2019 | Avantika
Ten years of the Forest Rights Act: Opportunity lost?
Oct 1, 2019 | oxfamadmin
Meet the Bravehearts Standing Up Against Domestic Violence
May 27, 2020 | oxfamadmin
Addressing Violence Against Women and Girls the SAARC Way: Combat Human Trafficking
Sep 10, 2019 | oxfamadmin
Oxfam India’s journey from programme to campaign
Oct 24, 2019 | oxfamadmin
सामाजिक मान्यताओं को चुनौती देता संगठन
Dec 5, 2019 | oxfamadmin
Changing The World – One Couple At A Time
Oct 24, 2019 | oxfamadmin
A Lesson on Education from Uttar Pradesh
Oct 7, 2019 | oxfamadmin
Fair Sharing of Mining Revenue for the Tribals
Oct 24, 2019 | oxfamadmin
An Open Letter to Chhotu, Munna and Bachcha
Jun 12, 2020 | oxfamadmin
Educating the Educators
Sep 27, 2019 | oxfamadmin
10 Years of Domestic Violence Act: The Way Ahead
Oct 24, 2019 | oxfamadmin
Oxfam Best Film on Gender Equality Award Gets Grand Reception
Sep 27, 2019 | oxfamadmin
Wrestling Social Norms Out
Oct 3, 2019 | oxfamadmin
The Toilet Conundrum
Oct 24, 2019 | oxfamadmin
Making surface water safe for drinking
Oct 1, 2019 | oxfamadmin
Quality Education- The unfinished agenda of RTE Act
Sep 27, 2019 | oxfamadmin
Tale of Two Women
Sep 27, 2019 | oxfamadmin
Prioritising the Health of our Children
Oct 24, 2019 | oxfamadmin
Violence in women’s own backyard
Sep 9, 2019 | oxfamadmin
We failed yet again
Sep 10, 2019 | oxfamadmin
Providing access to iron-free drinking water
Oct 7, 2019 | oxfamadmin
Her Series - Tale of Buguru Chitamma: How a cooperative transformed fisher women into leaders
Oct 24, 2019 | oxfamadmin
Why the CAF bill conflicts with the Forest Rights Act?
Oct 7, 2019 | oxfamadmin
Renew to Live Anew
Sep 9, 2019 | oxfamadmin
What do we want: Health as a ‘Right’ or just an ‘Assurance’
Nov 18, 2019 | oxfamadmin
Oxfam International signs historic deal to move to Nairobi, Kenya
Oct 24, 2019 | oxfamadmin
Why is passing the Women’s Reservation Bill urgent?
Sep 19, 2023 | oxfamadmin
BREXIT & What It Means for Humanitarian Aid
Oct 7, 2019 | oxfamadmin
Rahul Bose: Films should be gender sensitive
Oct 24, 2019 | oxfamadmin
Portrait of a Teacher: Successful introduction of multi-lingual education for Odisha’s tribal communities
Nov 6, 2019 | oxfamadmin
Tax dodging is a crime against developing countries
Sep 10, 2019 | oxfamadmin
Signs of social risks impacting Indian businesses
Oct 7, 2019 | oxfamadmin
Tikamgarh revisited, what’s happened to the amazing fishing communities I visited in 2006?
Jan 9, 2020 | oxfamadmin
Where school means freedom
Sep 10, 2019 | oxfamadmin
Yes, Prime Minister
Oct 30, 2019 | oxfamadmin
India’s National Budget 2016-17: Missed Opportunity to Address Inequality?
Oct 1, 2019 | oxfamadmin
Free The Night
Sep 9, 2019 | oxfamadmin
Woman, Open Your Eyes…
Oct 24, 2019 | oxfamadmin
From Darbhanga to Davos: Access to Affordable Medicine Still Remains a Key Question
Dec 16, 2019 | oxfamadmin
Hoping for a Second Chance: Punita Devi
Sep 27, 2019 | oxfamadmin
Activating Youth in Lucknow to Promote Girls’ Education
Sep 27, 2019 | oxfamadmin
Change is Coming: Rani Bitti’s Story
Sep 10, 2019 | oxfamadmin
Rachna’s Fight for Justice
Oct 7, 2019 | oxfamadmin
3 Key Observations from #WEF2016 that Indian Businesses Must Take Note Of
Sep 27, 2019 | oxfamadmin
Here’s Why States Need to Provide Free Basic Medicines
Nov 18, 2019 | oxfamadmin
Update: Oxfam to Provide Shelter to 300 Households Hit by The Manipur Earthquake
Apr 5, 2019 | oxfamadmin
In El Salvador, a struggle to survive El Niño
Oct 24, 2019 | oxfamadmin
Bihar designs a 15-year roadmap to reduce risk of disaster
Feb 20, 2020 | ursila
Violence as an Effective Mode of “Indian” Communication
Apr 5, 2019 | oxfamadmin
Because it’s 2015!
Sep 27, 2019 | oxfamadmin
Let’s welcome a new dawn, minus domestic violence
Oct 24, 2019 | oxfamadmin
Data and Discrimination: Women’s Ownership of Assets in India
Oct 24, 2019 | oxfamadmin
“No Woman, No Cry!”
Sep 27, 2019 | oxfamadmin
Pushing, pulling and the power of people: new horizons for corporate responsibility?
Jan 9, 2020 | oxfamadmin
Yes bank - say to inclusive and social banking and inclusive business model
Sep 27, 2019 | oxfamadmin
Creating shared value through inclusive business
Oct 7, 2019 | oxfamadmin
TATA consultancy services – empowering farmers with mobile technology
Sep 27, 2019 | oxfamadmin
What the CSR numbers don’t tell
Oct 1, 2019 | oxfamadmin
6 important things companies need to do to be inclusive
Nov 21, 2019 | oxfamadmin
Why businesses need to invest in creating a productive population for a sustainable future
Sep 10, 2019 | oxfamadmin
Jaipur rugs – weaving the lives of the poor into the global markets. an inclusive business model.
Oct 24, 2019 | oxfamadmin
The next 15 years: highlighting the role of the private sector in development
Oct 7, 2019 | oxfamadmin
Emphasizing a human rights-based approach to inclusiveness in business
Oct 30, 2019 | oxfamadmin
Privatising Forests: A Bad Idea
Oct 30, 2019 | oxfamadmin
Adoption of Agenda 2030: 17 SDGs for 15 years
Nov 15, 2019 | oxfamadmin
Five questions about the #GlobalGoals you were too embarrassed to ask
Oct 7, 2019 | oxfamadmin
Last mile smile
Oct 7, 2019 | oxfamadmin
Social responsibility of companies should not stop at 2%
Sep 27, 2019 | oxfamadmin
In ‘campaign mode’, states flout FRA rules
Sep 27, 2019 | oxfamadmin
“I will not leave my forest. I will keep my jungle”
Oct 1, 2019 | oxfamadmin
Healthcare for all in India: When, How, and Why RSBY?
Oct 24, 2019 | oxfamadmin
Where is the nutrition? Ask pregnant women in a village of Bihar
Jan 9, 2020 | oxfamadmin
Learning to read at schools, but where are the textbooks?
Oct 24, 2019 | oxfamadmin
Progressive tax norms must underlie financing of the Sustainable Development Goals
Sep 27, 2019 | oxfamadmin
Teachers needed! Government schools are falling behind due to lack of funds
Oct 24, 2019 | oxfamadmin
Protect and expand India’s public healthcare system: The inequality imperative
Dec 16, 2019 | oxfamadmin
“On My Second Day At School, A Kid Asked Me What Caste I Was”
Oct 7, 2019 | oxfamadmin
India’s missing girls: A tale of healthcare neglect faced by girls
Sep 9, 2019 | oxfamadmin
Should we only give attention to women’s health on International day of action?
Nov 18, 2019 | oxfamadmin
No respite for 72-year-old Sitaram, a month after #NepalEarthquake
Oct 7, 2019 | oxfamadmin
One month on, education of children still jolted by Nepal earthquake
Oct 24, 2019 | oxfamadmin
New worry for Nepal; landslides, floods may block relief work
Oct 7, 2019 | oxfamadmin
Monsoon preview in Kathmandu blows away shelters in relief camp
Oct 1, 2019 | oxfamadmin
Last mile distribution of relief supplies is biggest challenge in Nepal: Indian ambassador
Oct 7, 2019 | oxfamadmin
When Delhi’s Streets Buzzed with ‘Haq Banta Hai’
Oct 7, 2019 | oxfamadmin
Lack of water, toilets making things worse for women in Nepal
Oct 7, 2019 | oxfamadmin
Oxfam India gets government approval to respond to #NepalEarthquake in 28 hours
Apr 5, 2019 | oxfamadmin
Desperation creeping in, people in Nepal wait for aid
Oct 7, 2019 | oxfamadmin
#OxfaminNepal: “More than 60,000 litres of water has been provided till now”
Oct 7, 2019 | Avantika
Political (and some other) priorities in Nepal as of 28 April 2015
Oct 30, 2019 | oxfamadmin
#Nepal Earthquake: “The death toll has crossed 2000 and this is just the beginning”
Jan 9, 2020 | oxfamadmin
#NepalEarthquake: It is going to be a long road to recovery
Oct 24, 2019 | oxfamadmin
Money Matters!
Oct 24, 2019 | oxfamadmin
All for Education, Education for All
Oct 7, 2019 | oxfamadmin
When schools continue to exclude, can education reduce caste discrimination in India?
Feb 20, 2020 | oxfamadmin
Ensuring the right to education, forming bonds for life
Oct 1, 2019 | oxfamadmin
How can India send a spaceship to Mars but not educate its children?
Sep 30, 2019 | oxfamadmin
India wins in cricket, but losing out on education
Sep 30, 2019 | oxfamadmin
Oxfam's 'Even it up' report a must read lesson on Inequality
Oct 24, 2019 | oxfamadmin
It’s time to understand ‘womanhood is beyond maternity’
Oct 7, 2019 | oxfamadmin
The True Measure of Land's Value
Oct 7, 2019 | oxfamadmin
The “Ten-thousand Committee”: Reviving VHSNCs in Jharkhand
Oct 1, 2019 | oxfamadmin
Singing their way out of child marriage
Sep 10, 2019 | oxfamadmin
Land Acquisition bill tests government’s pro-poor stance
Oct 1, 2019 | oxfamadmin
Breaking the silence, standing tall
Sep 27, 2019 | oxfamadmin
Making a Song and Dance about Child Marriage
Oct 7, 2019 | oxfamadmin
Let’s Talk About Sex
Sep 10, 2019 | oxfamadmin
Mobile technology solutions could be a game changer for maternal health: Scribes
Sep 27, 2019 | oxfamadmin
Missing Girls: The Puzzling Domestic Violence Agenda
Oct 3, 2019 | oxfamadmin
Her Ghar: A right to residence for every woman
Oct 7, 2019 | oxfamadmin
Considering Gender: A Mediaperson’s Guide to Covering Disasters
Dec 16, 2019 | oxfamadmin
True Grit
Apr 5, 2019 | oxfamadmin
Violence against women and star power: Does their magic wand work?
Oct 24, 2019 | oxfamadmin
Having Those Difficult Conversations
Oct 24, 2019 | oxfamadmin
Day of the Man: guarding the china shop
Oct 7, 2019 | oxfamadmin
Gender parity needs to begin at home with mother’s guardianship rights!
Sep 9, 2019 | oxfamadmin
It’s a Girl!
Oct 1, 2019 | oxfamadmin
Let’s Help End Domestic Violence!
Oct 24, 2019 | oxfamadmin
A Few Good Men
Oct 7, 2019 | oxfamadmin
Promises to keep—Implementation of PWDV Act in Odisha
Sep 27, 2019 | oxfamadmin
Make 16 Days of Activism an Everyday Practice
Oct 30, 2019 | oxfamadmin
Witch-Hunting: A less talked about form of Violence Against Women
Oct 24, 2019 | oxfamadmin
Markets Also Discriminate
Oct 7, 2019 | oxfamadmin
Let’s Talk About Domestic Violence!
Oct 7, 2019 | oxfamadmin
Getting Serious about Ending Violence against Women and Girls
Oct 3, 2019 | oxfamadmin
Right to a Violence Free Life
Sep 10, 2019 | oxfamadmin
It’s all about the money
Sep 10, 2019 | oxfamadmin
‘It’s No Longer Funny': The Funding Wars That’ll Dictate Our Future
Oct 7, 2019 | oxfamadmin
Girl, Interrupted
Oct 1, 2019 | oxfamadmin
16 Pictures From Imagining Inequality That WiIl Tell You The Truth #evenitup
Oct 24, 2019 | oxfamadmin
These 8 Goals Were Set To Develop The World, But 14 Years Since, This Is Where We Stand
Dec 5, 2019 |
A Look At The Year 2029: What Kind Of Legacy Will We Leave Behind For Our Future Generations?
Nov 18, 2019 |
These 8 Goals Were Set To Develop The World, But 14 Years Since, This Is Where We Stand
Oct 24, 2019 | oxfamadmin
BRICS bank a necessary step, but needs more transparency
Sep 9, 2019 |
Short term memory and Long term needs!
Oct 7, 2019 |
A people’s budget has to go beyond...
Oct 24, 2019 |
National Shame, National Failure
Sep 27, 2019 | oxfamadmin
Oxfam India pledges its support to #BringBackOurGirls
Oct 1, 2019 | oxfamadmin
Closing the Gap on Gender: Is India up for the challenge?
Nov 15, 2019 | oxfamadmin
She tills, she sows, but she does not own
Oct 7, 2019 | oxfamadmin
Take a pause: what do the Uttrakhand floods tell us about India’s development model?
Sep 10, 2019 | oxfamadmin
Saving lives on sharp turning roads
Oct 1, 2019 | oxfamadmin
They do mind the gap
Oct 7, 2019 | oxfamadmin
Right to Education, still a long way to go.
Oct 1, 2019 | oxfamadmin
Can We Close the Gap on Women's Inequality in India?
Oct 30, 2019 | oxfamadmin
Breaking Old Barriers and Building New Alliances for Food Justice in India and Globally
Oct 24, 2019 | oxfamadmin
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