It is a good time for the rich in India. India added 18 new billionaires last year raising their number to 119. Their wealth increased by 35 per cent last year – Rs 2200 crore a day – and crossed the US$400 billion (INR 28000 billion) mark for the first time. While the wealth of the top 1 per cent in India increased by 39 per cent, that of the bottom 50 per cent increased at a dismal 3 per cent. India’s top 1% of the population holds 51.53% of the national wealth. The bottom 60%, the majority of the population, own merely 4.8% of the national wealth. The wealth of the top 9 billionaires is equivalent to the wealth of the bottom 50% of the population.
This abstract figures result in a real difference in life chances. While India’s rich have access to the best of everything, India’s poor often remains deprived of the basics necessary for survival. Children from poor families in India are three times more likely to die before their first birthday than those from rich families. 45 per cent of India’s tribal children are underweight, 1.5 times higher than non-tribal children. A Dalit woman can expect to live almost 14.6 years less than one from a high-caste.In 2018, it was 108th on the World Economic Forum’s Global Gender Gap Index, 10 notches less than in 2006.
This is not accidental or inevitable. India’s public policies are skewed in favour of the already privileged. India’s super-rich does not pay adequate taxes, taxes that could have funded much needed public services. While the Credit Suisse Report implies that around 3,500 Indians hold wealth that would provide incomes in excess of ₹500 crores, the CBDT data shows that only 179 individuals actually reported this level of income in 2017-18. While this is the status of taxation of individuals, tax evasion and avoidance by corporations is likewise a huge issue.
Failure of the state to impose an effective and progressive taxation system means that the richer are only getting richer while the poor remain poor. It also means that the government lacks the resources necessary to invest in effective public provision. Thus, getting the richest one per cent in India to pay just 0.5 per cent extra tax on their wealth could raise enough money to increase government spending on health by 50 per cent.
This is important when India’s expenditure of the Centre and State for Medical & Public Health, Sanitation & Water Supply is Rs 2,08,166 crore (INR 2082 billion), less than the wealth of India’s richest billionaire Mukesh Ambani at Rs 2,80,700 crore (INR 2807 billion). It is doubly so when India spends an abysmally low 1.3% GDP on health. In the absence of adequate public spending, 68% of Indians have limited to no access to essential medicines and 55 million Indians were pushed into poverty in 2017. Free, universal public services have been shown to play a critical role in addressing inequality, India’s essential services are highly stratified in terms of quality, with the poorest quality of service being delivered to India’s poorest.
Girls and women discriminated against in society and are the most affected when public services decline. India ranks 125th (of 188) on UNDP’s Gender Inequality Index. Girls are pulled out of school first when the money isn’t available to pay fees, and women clock up hours of unpaid work looking after sick relatives when healthcare systems fail. Oxfam estimates that if all the unpaid care work carried out by women across the globe was done by a single company it would have an annual turnover of $10 trillion – 43 times that of Apple, the world’s biggest company. Women in urban India spend 312 minutes per day on unpaid care work; men spend only 29 minutes. This disproportionate burden of unpaid care work by women means that they miss opportunities to participate in the paid labour force. India’s value of unpaid care work as a percentage of GDP is 3.5% (PPP 2011) of which women contribute 3.1%. With one of the lowest female labour force participation in the world and declining, India’s growth story has not benefited women and other genders.
Women are not the only losers, however. SCs have the lowest wealth ownership and there has been a decline in the relative wealth of SCs and STs in rural India; forward castes are overrepresented in the top 10% and 50% population.
India’s constitution states that all citizens are equal. However, this is scarcely true when 9 men own the same wealth as 50% of India’s population or 650 million people. As John Rawls and others have argued, extreme inequality in wealth creates unequal access to the political system and to positions of power. Extreme inequality breaks social cohesion. In contrast, strong correlations exist between equality and positive aspects of society such as happiness and human development. It is time to take a stand in the fight against Inequality. It is time to make an effort to build a more equal society that delivers sustainable wellbeing for all of us and for the planet.
Taneja is a Campaign Lead, Inequality at the Oxfam India, which recently released India Inequality Report 2018.