India is not Your Inequality Story

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Contrary to popular narratives, India is not merely the world’s fourth-largest economy; it is also the world’s fourth most equal society. According to the World Bank’s Gini Index—an index that measures the extent to which the distribution of income or consumption by households in an economy deviates from a perfectly equal distribution (a Gini Index of 0 represents perfect equality, 100 perfect inequality)—India is more equal than every member of the developed G7 and the wider G20 (see Table).

India’s Gini Index currently stands at 25.5 and is classified by the World Bank as a country with a “moderately low” inequality. It is just half a point away from joining the club of “low inequality” countries—the Slovak Republic (24.1), Slovenia (24.3), and Belarus (24.4). Excluding these, India has a more equal society than all the other 167 countries for which World Bank data is available. India is 10 points higher than China, 15 points higher than the United States (US).

Led by India and ending with Canada, 30 countries have a “moderately low” score, between 25 and 30.  This includes four out of five Nordic countries (Iceland at 26.6, Norway at 26.9, Finland at 27.9 and Denmark at 29.3), Poland, Europe’s fast-growing US$800 billion economy, is a t 28.9, Belgium, European Union’s headquarters at 26.4, and the United Arab Emirates, the world’s biggest attractor of billionaires, at 26.4.

Each of these countries has looked at wealth redistribution in different ways. In 2004, on a Gini Index of 31.6, Norway was not part of this list. Denmark, conversely, has seen inequality gradually rise, from 24.9 in 2004 to 29.3 today, despite remaining in the relatively equal bracket. From a Gini Index of 38.0 in 2004, Poland has made substantial progress. Its economic growth has also been a more equitable growth.

In the case of India, the political focus on wealth redistribution began before wealth creation. Between 1977 to 2022, India’s Gini Index declined from 29.7  to 25.5, marking a shift towards using wealth creation as a lever for wealth redistribution. India can be seen as a geography where capitalism is not at cross purposes with democracy. India’s economic reforms of the 1990s saw the Gini Index rise from 26.1 in 1993 to 28.8 in 2011. They ensured that the returns from reforms were trickling down, and today, India is the most equitable society it has had in the past 45 years. So, not only is India the world’s fourth most equal society in relative terms, it has also embraced equality in absolute terms.

India’s economic reforms of the 1990s saw the Gini Index rise from 26.1 in 1993 to 28.8 in 2011. They ensured that the returns from reforms were trickling down, and today, India is the most equitable society it has had in the past 45 years.

Countries with a Gini Index of between 30 and 40 are classified as those that have “moderately high” inequality. There are 87 countries in this group, ranging from Nepal and Croatia (both at 30.0) to Jamaica at 39.9. Among others, Sweden at 31.6 finds a place here. As do nine G20 members—France at 31.2, Japan at 32.2, Germany at 32.4, the United Kingdom at 32.4, Italy at 33.7, Australia at 34.3, Indonesia at 34.9, the Russian Federation at 35.1, and China at 35.7. This is apart from Switzerland at 33.8.

A Gini Index with a value of 40 or means that the country has “high inequality”. The 32 countries in this group include three G20 members—the US at 41.1, Mexico at 43.5, and Türkiye at 44.5. Of these, the inclusion of the US, the world’s largest economy and most powerful nation, is shocking not because of the absolute number but because it has been on the higher side since 1993 (40.4). For President Donald J. Trump, the domestic policy imperative is clear: reduce inequality to at least 1980 levels (34.7) and move up the rankings.

The rise of India as the world’s fourth-largest economy — expected to cross Germany in 18 months and become the third-largest—arguably reflects one of the most robust and inclusive models of economic policymaking.

Finally, countries that have a Gini Index of 45 and higher are classified as “very high inequality”. These are geographies of concern and include two G20 members—Brazil at 51.6 and South Africa, which at 63.0 is the world’s most unequal society. Other members here are Guyana at 45.1, Zambia at 51.5 and Botswana at 54.9. Several of these 19 countries are rich in mineral resources; all they need to do is embed accountable governance into their economies and translate the benefits of prosperity to the people.

The rise of India as the world’s fourth-largest economy — expected to cross Germany in 18 months and become the third-largest—arguably reflects one of the most robust and inclusive models of economic policymaking. Economic opportunities have been taken up across the board, down to the bottom. There is not a single constituency that has not benefited from economic reforms that began under constraints in 1991 and continue with conviction today. That’s what good economic governance is all about. That’s what a successful democracy is. Those quick to deliver lectures on inequality may wish to turn their gaze toward more deserving targets.

Table 1: Global Inequalities

Source: World Bank Data

Gautam Chikermane is Vice President at the Observer Research Foundation.

• International Affairs
• China
• European Union
• India
• Russia and Eurasia
• USA and Canada
• gini index
• gini index india
• gini index india 2025
• gini index india rank
• income inequality in india
• wealth inequality in india

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