As per the media reports, the marriage of Anant Ambani and Radhika Merchant is expected to cost Rs. 5,000 Crore. It has caught the attention of the national media which seems to have fallen head over heels with the marriage. While it may be argued that this could be quite normal for a family which is among the wealthiest and forms the economic elite and may even be seen by those as India’s growing economic prowess similar to the claims of India being the fifth largest economy, it hides more realities than it reveals.
As per the Oxfam’s report “Survival of the Richest: The India Story”, the richest 5% of Indians own more than 60% of the nation’s wealth, while the bottom 50% share only 3% of the wealth. 40% of the wealth created during 2012-21 went to 1% of the Indians. India had about 166 billionaires. The combined wealth of 100 richest Indians was enough to fund the entire Union budget for 18 months. The report also points towards gender inequality with female workers earning only 63 paise for every 1 rupee for male workers. Marginalized communities, such as Dalits, Adivasis and Muslims continue to suffer, paying disproportionately higher taxes and spending more on essentials compared to the rich. It states while the country suffers from multiple crises like hunger, unemployment, inflation and health calamities, India’s billionaires are doing extremely well for themselves.
The paper by Thomas Piketty and others “Income and Wealth Inequality in India, 1922-2023: The Rise of the Billionaire Raj” highlights the trends in economic disparity in India in the last century. Post-independence, inequality declined until the early 1980s, but it began rising again with the economic reforms and has surged since the early 2000’s. By 2022-23, the top 1% of the population held 22.6% of the total income and 40.1% of the total wealth, reaching their highest historical levels. The share of wealth by the top 1% Indians is considered to be the highest in the world. According to the Global Hunger Index, India, while being the second largest food producer in the world based on calorie content, is ranked 111 out of 125 countries. This despite it being self-sufficient in food production. The hunger status is considered serious. About one quarter of the world’s population which is undernourished is in India. Despite some improvements on the human development front, the Human Development Report also warns against growing inequalities.
Economic thinkers and Scholars have cautioned against economic inequalities and its implications. Karl Marx has pointed out that inequality and exploitation leads to class conflicts eventually resulting in overthrow of the capitalist system. John Rawls has argued that social and economic inequalities are only justified if they benefit the least advantaged members of society. Thomas Piketty has argued that without an intervention such as progressive taxation, inequality will continue to grow, leading to social and economic instability. Amartya Sen highlights that inequality should be measured not just by income or wealth, but by an individual’s ability to achieve valuable outcomes. He highlights how disparities in health, education and other areas can limit people’s capabilities and opportunities. Joseph Stiglitz points out how excessive inequity leads to economic inefficiency and undermines democracy. Wilkinson and Pickett point out evidence showing how societies with more equality tend to have better health outcomes, lower crime rates and higher levels of trust and social cohesion. They argue that reducing inequality is beneficial for everyone in society, not just the poor.
Higher economic inequalities have only negative implications for society. It makes societies dysfunctional as only few parts of a society grow at the cost of the whole society. It is similar to one part of the human body growing and remaining stagnant, which cannot be considered a complete growth. An unequal society cannot be prosperous, peaceful, progressive, participative and based on principles.
Reduced economic inequalities have only benefits from the angle of five P’s.
Prosperity: Reduced economic inequalities only contribute to prosperity. As the income levels of those at the bottom of the pyramid grows, it only expands the consumer base, driving demand and economic prosperity. Access to education and healthcare for those at the bottom of the pyramid only improves workforce skills and productivity which in turn benefits the economy.
Peace: Reducing disparities only lowers social tensions and promotes harmony within communities. Many of the social conflicts are also associated with inequalities and unequal access to resources and opportunities. Such tensions are lowered. Balanced economic opportunities reduce social grievances and contribute to social stability and peace.
Progress: Equal access to resources and opportunities create spaces for individual human development and contribute to social progress. A society where all sections of society have an equal opportunity to grow is the one that displays progress. A diverse and inclusive society which cares for all specifically those at the bottom most benefits. It also broadens and benefits the range of talent, skills, perspective and innovations coming from below.
Participation: Economic equity also with social equity enhances political participation and strengthens democratic institutions. Equal opportunities enable marginalized groups to actively contribute to and benefit from society. It prevents capture by the economic elite and running of institutions for the benefit of few.
Principles: Addressing inequalities aligns with ethical principles of fairness and social justice. Ensuring everyone has basic economic security upholds human dignity and rights.
A movement towards more social and economic equity has advantages than one based on gross economic inequalities. Societies can be more prosperous, peaceful, progressive, participative and based on principles if based on social and economic equality.
T Navin is an Independent writer
