India ranks among the most unequal nations in the world according to the World Inequality Report 2022. This is made in terms of the wealth and gross income of the country.
According to this inequality report, the top 10% and 1% of the population hold 57% and 22% of the overall income of the country. However, the bottom 50% holds only 13% of the income. Hence, India stands in the international forum as a country with huge differences in society. Society is broken down into an affluent yet small elite class and a maximum poor population.
This social gap is not met due to crony capitalism and inheritance. This social gap is never filled and the rich get richer while the poor remain poor. The affluent class has easy access to everything while the poor struggle to get minimum wage and access to resources.
Why is the overall income unequal?
Unemployment is one of the major reasons behind this inequality. The lack of employment among the masses is a major reason behind the income gap in the country.
Another important factor is the government’s dependence on indirect taxes. These indirect taxes gather a large amount from the income of the low-paying people. Moreover, there’s a decrease in the percentage of corporate tax in the gross revenue receipt of the government.
Also, the high cost of education and healthcare services results in high debts among people. This also causes income disparity.
What are the steps taken by the government?
The government has started investing more in social sectors. For instance, healthcare and education becoming cheaper would help in balancing the indirect taxes. Moreover, several social protection schemes have improved household conditions to a great extent. Targeted efforts in areas of water availability and sanitation have increased the standard of living.
More intensive jobs, employment and good healthcare and education facilities will work towards closing the social gap in India.