As India is set to project itself as the fastest growing economy and among global investors’ favourite destinations at the 48th World Economic Forum in Davos, a survey presents a worrying picture of rising income inequality in the country.
The richest 1% in India cornered 73% of the wealth generated in the country last year, a survey done by the international rights group Oxfam indicates.
In contrast, 2017 saw the wealth of 670 million poor Indians rise by just 1%.
The scenario seems grimmer globally with 82% of the wealth generated last year worldwide going to 1%, while 3.7 billion poor saw no increase in their wealth.
The report titled ‘Reward work, not wealth’ reveals how the global economy enables wealthy elite to accumulate vast wealth even as hundreds of millions of people struggle to survive on their paltry pay.
2017 saw an unprecedented increase in the number of billionaires, at a rate of one every two days. Billionaire wealth has risen by an average of 13% a year since 2010 — six times faster than the wages of ordinary workers, which have risen by a yearly average of just 2 per cent.
In India, it will take 941 years for a minimum wage worker in rural India to earn what the top paid executive at a leading Indian garment firm earns in a year, the survey covering 70,000 respondents in 10 countries indicated.
In the US, it takes slightly over one working day for a CEO to earn what an ordinary worker makes in a year, it added.
Most respondents sought action on inequality. Nearly two-thirds of them wanted the disparity between the rich and the poor to be urgently addressed.
With Indian Prime Minister Narendra Modi attending the Davos meeting, Oxfam India urged the government to ensure that the country’s economy works for everyone and not just a few.
Oxfam sought tough steps against tax evasion, higher tax on super-rich and removal of corporate tax breaks.
India added 17 new billionaires last year, taking the total number to 101. Top 10% of population holds 73% of the wealth and 37% of billionaires have inherited family wealth. They control 51 per cent of the total wealth of billionaires in the country.
Oxfam India CEO Nisha Agrawal said it is alarming that the benefits of economic growth in India continue to concentrate in fewer hands.
The billionaire boom is not a sign of a thriving economy but a symptom of a failing economic system.
Those working hard, growing food for the country, building infrastructure, working in factories are struggling to fund their child’s education, buy medicines for family members and manage two meals a day.
The growing divide undermines democracy and promotes corruption and cronyism, Agrawal said.