India Emerges Among the Most Income-Equal Nations Worldwide
According to recent data, India has secured the 4th position globally in terms of income equality, boasting a Gini Index of 25.5 in 2022. This figure places India ahead of economic giants like China, the United States, and several major G7 and G20 countries, highlighting its progress in balancing robust economic growth with social equity.
Understanding India's Position on the Gini Scale
The Gini Index, a widely recognized measure of income disparity, ranges from 0 (perfect equality) to 100 (absolute inequality). India's score of 25.5 situates it firmly in the moderately low inequality category—just a notch away from entering the low inequality bracket alongside countries such as the Slovak Republic (24.1), Slovenia (24.3), and Belarus (24.4).
This achievement is particularly noteworthy since many nations with stronger welfare systems, including Iceland, Norway, Finland, and Belgium, comprise the limited group of 30 countries classified within this range globally. India's sustained climb from a Gini Index of 28.8 in 2011 to 25.5 a decade later spotlights the country’s steady march towards an equitable society.
Impact of Poverty Reduction on Income Equality
India’s commendable standing reflects concerted efforts in alleviating poverty across both rural and urban landscapes. A recent World Bank report reveals that over 171 million people have been lifted out of extreme poverty in the last ten years alone.
The proportion of Indians living below the global extreme poverty line of $2.15 per day (valid until mid-2025) plummeted from 16.2% in 2011-12 to just 2.3% in 2022-23. When applying the updated threshold of $3.00 per day, the poverty rate adjusts to 5.3% for the same period. This dramatic reduction plays a pivotal role in driving down income disparity as measured by the Gini Index.
Comparing India with Other Global Economies
With a Gini Index significantly lower than China’s 35.7 and the United States’ 41.8, India stands out as one of the most equal economies among the world's largest and most developed. Notably, every G7 and G20 country currently ranks below India in terms of income equality.
What the Future Holds
India’s journey towards greater income equality is far from accidental. It reflects a consistent policy push to marry economic advancement with inclusive growth, benefiting millions over the years. As the country edges closer to joining the 'low inequality' group, its progress underscores a broader narrative of sustainable development rooted in fairness and social upliftment.
