Modi govt's policies widened inequality in India: Latest global report reveals how it is benefitting only rich

Modi government’s policies for the development of the country are highly defective, since it works for the rich and against the poor, driving inequality to make India among the most unequal countries of the World. Top 10 per cent of the affluent elite are earning on an average twenty times more than the bottom 50 per cent of the population with an average earning of merely little less than Rs 149 per day.

The World Inequality Report 2022, just released by the Paris-based World Inequality Lab, has revealed this shocking data as against the recently released National Multidimensional Poverty Index (MPI) report 2021, which said only 25.01 percent of India’s population as “multidimentionally poor”. The level of extreme poverty has more than doubled, and their earning in the national income has even gone down 13 per cent. Thus India stands out as a poor and very unequal country with its affluent elites.

The top 10 per cent of the affluent elites are earning Rs 11,66,520 yearly while the bottom 50 per cent merely Rs 53,610. This top 10 per cent are holding 57 per cent of the national wealth. If we compare this affluent elite population with top 1 per cent of the super affluent elite, it would give a picture in which Modi’s policies could be seen working more for the super rich. This one per cent population is holding 22 per cent of the total national income.

It is in this backdrop, one is compelled to recall the allegation leveled against our Prime Minister Narendra Modi that he has been working for the super rich corporate houses. We wish the allegations to be untrue, but the way policies are working for this super rich section, which includes the policies of economic reform, such as labour reforms, farm reforms, bank reforms, insurance reforms and so on, points clearly towards somewhere something is wrong.

People generally feel they are growing when their private wealth grows. With this prevailing view of growth among a large number of people allows the Modi government to drumming up about growth of the people. There has been a rise of private wealth in India over the last four decades, which has been remarkable up from 290 per cent in 1980 to 560 per cent in 2020. It masks the disparities and inequalities on the one hand and significant reduction in the public wealth. The share of wealth of the public sector going down while of the private sector is going up. It is reducing the capacity of the governments in tackling inequality and problems of well-being of the people not in the present but also in the future, and the fate of the people would be largely dependent on handful of private hands.

How badly Modi government is performing can be found in the comment made in the report while flagging a drop in global income during 2020, with about half of the dip in rich countries and the rest in low-income and emerging regions. It was attributed primarily due to the impact of “South and Southeast Asia, and more precisely, India". “When India is removed from the analysis, it appears that the global bottom 50 per cent income share actually slightly increased in 2020,” the report stated.

Now come to the middle class in India, which, according to the report, is relatively poor among nationals, with an average wealth of only Rs 7,23,930 or 29.5 per cent of the total national income. It indicates that Modi’s policies are not even working for the middle class.

The average annual national income of the Indian Adult population is Rs 2,04,200 in 2021. It is about 4 times higher than the average earning of the bottom 50 per cent. The average household wealth in India is Rs 9,83,010, but the bottom 50 per cent owing almost nothing, with an average wealth of 6 per cent of the total Rs 66,280.

Modi’s government’s claim of rapid development proves to be false, since the share of top 10 per cent and bottom 50 per cent in pre-tax national income has remained broadly constant since 2014.

There has been an allegation on Modi government that they are not giving real picture of the country but always presenting the rosy picture to hoodwink the people. In this context the statement the report contains is worth noting, which says, for India, the quality of inequality data released by the Government has seriously deteriorated, making it particularly difficult to assess recent inequality changes.

In Modi Raj, inequality in India has widened even compared to British Raj (1858-1947), when the top ten per cent of the population shared around 50 per cent of the national income. That inequality was considered very high. As for the wealth, the top ten share 65 per cent, and top one per cent 33 per cent of total national wealth. It has been pointed out by the report that since independence, the socialist-inspired five year plans contributed to reducing this share to 35-40 which was around 50 per cent for the top ten in 1947. This fact clearly refutes the allegation of the Modi government that earlier government did nothing while the present government is doing everything for the development of this country.

The report has pointed out the deceptiveness of the national average income of adult population categorically clarifies that it masks the inequalities.

The report mentions deregulation and liberalization started in mid-1980s which have led to one of the most extreme increases in income and wealth inequalities. The top ten per cent has clearly been largely benefited from the economic reform.

As for the gender inequalities, it is very high in India, where female labour income share is equal to 18 per cent, significantly lower than the average in Asia, excluding China, at 21 per cent. “This value is one of the lowest in the world, slightly higher than the average share in West Asia at 15 per cent. … It has been insufficient to lift women’s labour income share to the regional average, the report said. It indicates about the hollowness of the women’s empowerment slogan of the Modi government.

We are generally blind of our own faults, and so is Modi, our Prime Minister. He must change his policies that may work for all, not only for the super rich one per cent, or the rich 10 per cent.

(IPA Service)