Winning the Growth Game: India and Economic Inequalities

Winning the Growth Game: India and Economic Inequalities

Question : BCG has recently released the “Winning the Growth Game: Global Wealth 2015” report. It raises important questions about income inequalities and balanced economic development in India. Discuss.

- BCG published the 15th annual report entitled “Winning the Growth Game: Global Wealth 2015”

- The report reveals that richest 1% of Indians own nearly half of its personal wealth

- Remaining 99% of the population is unequally sharing the rest; top 10 percent Indians own 74% of the personal wealth of the nation

- Remaining 90% f the nation share a meagre quarter of its resources

- Of the world’s poorest 20% , nearly 1 in 4 are Indians while China’s share is a mere 3 percent

- Several reports have pointed to the massive regional inequalities across block level and a large proportion of this constitutes the tribal population

- India’s tribals are worst off regarding income, health, education, governance, nutrition and infrastructure

- 40% of the 60 million were displaced following development projects in India are tribals

- 90% of coal and more than 50% of minerals are found in the tribal region

- Reduced inequality and sustained growth are two sides of the same coin, economists opined

How to Make Growth More Inclusive

- Overall direction of growth must also change and pattern of jobless growth must cease

- Faster growth for the MSME sector will generate a broader spread of employment and income earning opportunities for the population

- Sustainability is the core of the development strategy as the poorest regions of India are also more eco-fragile

- Tribal persons need to be offered a range of sustainable livelihood opportunities

- Huge income generation and biodiversity conservation possibilities exist if this is accomplished

- Better state capacities in regions of high poverty are an important requirement as well

- Absence of health and education facilities must be remedied. Globally, India spends among the lowest share of national income on health and education

- Programmes associated with poverty elimination such as MGNREGA have to be better implemented through efficient HRD management

- Growing market penetration of Indian cultivators is also an important goal to aim for

- Better governance is the need of the hour

- Reforms should be pro-poor otherwise inequalities will continue to escalate

Facts and Stats

- Even in thirty years following economic reforms and high growth, inequality continues to shoot and wealth has become more concentrated at the top

- Share of richest 10% families has risen from 66% in 2000 to 74%

- India’s super rich or top 1% owned 37% of India’s personal wealth in 2000 has increased the share to 49%

- Millions of Indians are not part of the growth story; the tribal population is the most alienated having suffered disadvantaged region and ethnicity