As per the latest World Inequality Report 2022, India is a “poor and very unequal country, with an affluent elite,” where 57 percent of the national income is held by top 10 percent, while the share of the bottom 50 percent is merely 13 percent in 2021.
There was also a drop in the global income in 2020, half of which took place in rich countries, while the rest was flagged in low-income and emerging nations.
However, the report, authored by economist and co-director of the World Inequality Lab, Lucas Chancel, along with economists Thomas Piketty, Emmanuel Saez and Gabriel Zucman, states that “When India is removed from the analysis, it appears that the global bottom 50 percent income share actually slightly increased in 2020.”
Extreme Income Inequalities
The average national income of the Indian adult population is Rs 2,04,200, according to the report.
While the bottom 50 percent population's average national income is at Rs 53,610, the top 10 percent earns around than 20 times more at Rs 11,66,520.
While the top 10 percent and top 1 percent hold respectively 57 percent and 22 percent of total national income, the bottom 50 percent share has gone down to 13 percent.
Income Inequality in the Long Run: A Historical High
As per the report,
"Since the mid-1980s, deregulation and liberalization policies have led to one of the most extreme increases in income and wealth inequality observed in the world. While the top 1 percent has largely benefited from economic reforms, growth among low and middle-income groups has been relatively slow and poverty persists. Over the past three years, the quality of inequality data released by the government has seriously deteriorated, making it particularly difficult to assess recent inequality changes."Worl Inequality Report 2022
According to the report, average household wealth in India stands at Rs 9,83,010 (less than half of China's average household wealth).
The bottom 50 percent own almost nothing, with an average household wealth of Rs 66,280, the report states.
It adds, the middle class is also relatively poor (with an average wealth of only Rs 7,23,930) as compared with the top 10 percent and 1 percent who own respectively (65 percent of the total at Rs 63,54,070) and (33 percent of the total at Rs 3,24,49,360).
Gender inequalities in India are very high compared to the regional average.
The female labour income share is equal to 18 percent, which is significantly lower than the 21 percent average in Asia.
The report stresses, "This value is one of the lowest in the world, slightly higher than the average share in the Middle East (15 percent). The significant increase observed since 1990 has been insufficient to lift women’s labor income share to the regional average."