'Billionaire Raj' dominated by upper castes: World Inequality Lab

A recent report has thrown a spotlight on the widening economic gap in India, as well as its sociological characteristics. The findings are stark: nearly 90 per cent of the country’s billionaire wealth is in the hands of upper-caste families!

The report, Towards Tax Justice and Wealth Redistribution in India, found that India's wealth is more unevenly spread this decade than has ever been the case since the 19th century — and that caste privilege is alive and thriving still.

While the report highlighted how the top 1 per cent controls over 40 per cent of India's total wealth — a situation that desperately needs a change — of particular interest is the way that inequality seems to reinforce caste margins as well.

The wealth divide

As per the report, a whopping 88.4 per cent of billionaire wealth in India is controlled by only the upper castes. On the other hand, Scheduled Tribes (STs), who are among the most marginalised communities, have no representation among the wealthiest Indians.

And it's not just the billionaire rung. Per the All-India Debt and Investment Survey (AIDIS) for 2018–19, the upper castes own nearly 55 per cent of the national wealth altogether.

Juxtapose this against the Pew Research Center's 2021 figures, that 'general castes' are only 30 per cent of the overall population, and only 4 per cent are Brahmins, the highest caste grouping. Meanwhile, 68 per cent of Indians count themselves in the OBC and SC/ST categories.

The World Inequality Lab data too underscores how deeply economic inequality is tied to caste status.

Does caste have a role to play in wealth creation?

Sadly, caste continues to influence and play a huge role in determining access to education, healthcare, social networks and credit — all essential for starting businesses and creating wealth.

Historically, Dalits could not own land in many regions, which has severely limited their economic progress.

The State of Working India, 2023 report by Azim Premji University finds that Scheduled Castes (SCs) and Scheduled Tribes (STs) are underrepresented as business owners compared to their numbers in the workforce.

Now, SCs make up 19.3 per cent of the workforce but own only 11.4 per cent of businesses, while the ST population contributes 10.1 per cent of the workforce and owns just 5.4 per cent of businesses.

Wealth inequality also shows up in household wealth. As per to the National Family Health Survey, only 12.3 per cent of SCs and 5.4 per cent of STs are in the highest wealth group. In contrast, over 25 per cent of SCs and 46.3 per cent of STs fall into the lowest wealth group.

As for the Backward Classes (OBCs), they also face disparities, with 16.3 per cent in the lowest wealth group and 19.2 per cent in the highest wealth group.

Record levels of inequality

India’s income and wealth inequality, which had decreased after independence, started rising in the 1980s and has surged since the 2000s. Between 2014–15 and 2022–23, the wealth gap widened dramatically.

The top 1 per cent of the population now controls over 40 per cent of India’s total wealth, up from 12.5 per cent in 1980. They also earn 22.6 per cent of the total pre-tax income, up from 7.3 per cent in 1980.

This sharp rise in inequality makes for a 'Billionaire Raj' dominated by India's modern elite, in a nation now more unequal than even under the exploitative British Raj — and places India among the most unequal countries globally.

The path forward

The World Inequality Lab’s report calls for urgent measures to tackle these extreme inequalities. The report has also proposed solutions, which include an annual wealth tax and an inheritance tax, both applying only to wealth above Rs 10 crore in 2022–23.

India’s rising economic disparities, which seem to be deeply rooted in its caste system, certainly need immediate attention. There is a clear and pressing need for progressive wealth taxation and effective redistribution policies. Addressing these issues could help India come close to becoming an equitable and prosperous country, where opportunities, especially economic opportunities, are accessible to all, regardless of caste or socio-economic status.