The World Inequality Lab (WIL) has mentioned in its latest report that economic disparity between rich and poor has broken all previous records in India in the past nine years! The WIL, a global research centre based at the Paris School of Economics (École d’économie de Paris) that focuses mainly on the study of inequality and public policies that promote social, economic and environmental justice, has further mentioned that the economic inequality is greater in contemporary India compared to the Colonial British era! The report has clearly stated: “The ‘Billionaire Raj’ headed by India’s modern bourgeoisie is now more unequal than the British Raj headed by the colonialist forces.” According to Nitin Kumar Bharti, Lucas Chancel, Thomas Piketty, Anmol Somanchi and other top economists of the WIL, the South Asian nation is currently under the rule of Billionaires led by the Modern Bourgeoisie. They have opined that Plutocracy may gradually be established in India.

As per the report titled Income and Wealth Inequality in India, 1922-2023: The Rise of the Billionaire Raj, top 1% income and wealth shares (22.6% and 40.1%) were at their highest historical levels in 2022-23, and India’s top 1% income share was among the very highest in the world, higher than even South Africa, Brazil and the US. In terms of earnings, the income of the bottom 50% or half of the Indian population was only 15% of the Gross National Income. However, the average income of the top 1% Indians was INR 5.3 million per annum, 23 times the income of the average Indians! Interestingly, the richest 10,000 people earned INR 480 million on an average per year… more than 2,000 times the income of average Indians in 2022-23. On the other hand, the average income of half of the population was only INR 71,000 per annum. Meanwhile, the yearly average income of 40% of middle-class Indians was INR 165,000.

Earlier, Oxfam had published a report on how the gap between rich and poor people widened in India in post-COVID-19 period. In that report, the British-founded confederation of 21 independent NGOs, focusing on the alleviation of global poverty, had shown how the rich people got richer and the poor got poorer. As expected, the WIL report on the economic inequality in India has created troubles for the Narendra Modi Government in New Delhi ahead of Parliamentary Elections (to be held from April 19 to June 1, 2024).

The Indian National Congress (INC, the main Opposition party) has claimed that billionaires have taken control of the country during Modi’s tenure as Prime Minister. The INC has also said that they are funding electoral campaigns of Prime Minister Modi’s Bharatiya Janata Party (BJP). Hence, PM Modi and the ruling BJP are taking care of those billionaires through various policies. Meanwhile, the Indian Ministry of Finance has announced that it would issue a statement only after going through the entire report.

In their report, Economists Bharti, Chancel, Piketty and Somanchi have mentioned that economic inequality peaked in India between 2014-15 (when Modi became the Prime Minister) and 2022-23. Although Prime Minister Modi often blames Pandit Jawaharlal Nehru, the first Prime Minister of India, for all the country’s woes, the WIL economists have shown that economic inequality declined between 1947 (when India became an independent nation) and the early 1980s. Later, it started to increase. The inequality has increased at a fast pace since the beginning of the 21st Century, and has reached the peak in the past decade.

The economists have explained that a possible reason why the economic inequality has increased could be the difference in salary growth between the public and private sectors until the 1990s. However, there is reason to believe that income from capital played a major role thereafter. As a result, 50% of the lower-class people and 40% of the middle-class people have remained suppressed. Furthermore, the Government has failed to provide the majority of people with high quality education. Instead, the Indian State has concentrated on the well-being of people belonging to the upper class. The WIL economists are of the opinion that India’s tax system places a heavy burden on the poor. Unemployment and decline in rural income are other major issues India is facing.

Bharti, Chancel, Piketty and Somanchi have warned that the extreme economic inequality shall have an impact on society, as well as the Government. It shall also weaken the democratic institutions. The Opposition parties have been complaining for a long time that democratic institutions have become weaker, as they have come under the control of the Modi Government (rather than being neutral). However, these democratic institutions were the role models of India after Independence. They have compromised their independence and impartiality in the last few years. Hence, India is more likely to move towards a Plutocracy. This is why India’s economic inequality needs to be addressed immediately.

The WIL economists have advised the Government of India to levy a 2% wealth tax on the 167 richest families. They have also advised the Government to improve sectors, like health, education and nutrition, with that revenue. These moves shall ultimately allow the majority of the Indians to enjoy the benefits of globalisation.

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Published by Koushik Das

Koushik Das (born on May 16, 1976 in Kolkata) is a career journalist. Based in the Indian capital of New Delhi, Koushik writes mainly about foreign policies and current geopolitical issues, and rarely about other topics. His own political ideas are highly influenced by Antonio Gramsci, Louis Althusser, Michel Foucault, Michael Oakeshott and others. English philosopher and political theorist Oakeshott (Dec 11, 1901-Dec 19, 1990) says that “in political activity, men sail a boundless and bottomless sea. There is neither harbour for shelter nor floor for anchorage, neither starting-place, nor appointed destination. But we have to keep afloat”. (Rationalism in Politics, 1962) As a student of Political Science, Koushik loves to share his views on issues, which have great impacts on his thought process (and also on India, South Asia and of course on the global community), with his readers through his website – Boundless Ocean of Politics. By doing so, he tries to keep himself afloat. You will find some of his articles in https://inserbia.info/today/ (https://inserbia.info/today/author/kou_das13_i/), as he has been trying to assess the global geopolitics since 2003. You can also mail him at kousdas@gmail.com View all posts by Koushik Das