The Executive Director of Oxfam International, Winnie Byanyima minced no words when she said “it is morally outrageous that a few wealthy individuals are collecting a growing share of India’s wealth.” Byanyima was speaking on 21 January, before the start of the five-day World Economic Forum, in the ski-resort of Davos, Switzerland at the release of Oxfam’s annual study, ‘World Inequality Report 2018’. She went on to add, “a few amass great wealth, while the poor are struggling to eat their next meal or pay for their child’s medicines. If this obscene inequality between the top one percent and the rest of India continues then it will lead to a complete collapse of the social and democratic structure of this country."
The OXFAM report is scathing, highlighting the scandalous economic ‘progress’ of a miniscule minority in India. Whilst most of the so-called mainstream media in India (mostly owned by the crony capitalist), there was one Gujarati newspaper, ‘Divya Bhaskar’ which banner headlined this reality in its edition of 22 January saying, “We are together with ALL, but help nine to progress”. The headline is quite a quip in the Gujarati language and article also highlights that out of the nine billionaires in India, five are Gujaratis! It is therefore not surprising that even before the 2014 elections Narendra Modi had become the poster boy of the Ambanis and Adanis who left no stone unturned to make him the Prime Minister of the country. The day Modi left Ahmedabad to take over the reins of the Prime Minister in Delhi, it was certainly not surprising that he flew in the private jet of Gautam Adani!
There are several points which the Report highlights on the growing gap between the rich and the poor in India. As the ‘Divya Bhaskar’ also notes, the study underlines the painful reality that the nine richest Indians now own wealth equivalent to bottom 50 percent of the country. While the top one percent owns 52 percent of national wealth, the bottom 60 percent own only five percent. Whilst, it is statistically proven, that this concentration of wealth is a global trend, wealth in other countries is generally controlled by just one percent of the population, whereas in India it is in the hands of just nine individuals or 0.000000075 percent of India’s population of 1.2 billion. The Report goes on to add, “unlike middle-eastern countries and Brazil, which have had historically high levels of inequality but have seen a decline in the share of the top 10 percent in total income, India has seen a spectacular rise in the share of income accruing to the top 10 percent and top one percent of the population”
In the Introductory remarks the authors state that “the objective of the World Inequality Report 2018 is to contribute to a more informed global democratic debate on economic inequality by bringing the latest and most complete data to the public discussion”. They go on to add that, “economic inequality is widespread and to some extent inevitable! It is our belief, however, that if rising inequality is not properly monitored and addressed, it can lead to various sorts of political, economic, and social catastrophes”
The data provided in the Report is very analytical; besides no normal person with a little bit of understanding will be able to fault its authenticity. That is perhaps the ‘heavy’ silence from most of India’s mainstream media- who normally rant and rave at almost anything. Oxfam says that its calculations are based on the latest comprehensive data sources available publicly, including from the Credit Suisse Wealth Databook and the annual Forbes Billionaires list.
India figures in several Chapters of the 289-pgs Report; however, there is an exclusive chapter (Pgs. 123-131) which focuses on India. The study provides some interesting data and analysis on the Indian economic reality and the growing inequalities in the country. For one, Indian billionaires saw their fortunes swell by Rs.2, 200 crore a day last year, with the top one per cent of the country's richest getting richer by 39 per cent as against just three per cent increase in wealth for the bottom-half of the population. The Oxfam study further stated that 13.6 crore Indians, who make up the poorest 10 per cent of the country, continued to remain in debt since 2004.
India added 18 new billionaires last year, raising the total number of billionaires to 119, while their wealth crossed the $ 400 billion (Rs. 28 lakh crore) mark for the first time. It rose from $ 325.5 billion in 2017 to $ 440.1 billion in 2018, making it the single largest annual increase since the 2008 global financial crisis. Oxfam further said getting India's richest 1 per cent pay just 0.5 per cent extra tax on their wealth could raise enough money enough to increase the government spending on health by 50 per cent. It said the combined revenue and capital expenditure of the centre and states for medical, public health, sanitation and water supply is Rs. 2,08,166 crore, which is less than the country' richest man Mukesh Ambani's wealth of Rs. 2.8 lakh crore.
Noting that a high level of wealth disparity subverts democracy, the study says, “India’s top 10 per cent of the population holds 77.4 per cent of the total national wealth. The contrast is even sharper for the top 1 per cent that holds 51.53 per cent of the national wealth. The bottom 60 per cent, the majority of the population, own merely 4.8 per cent of the national wealth. Wealth of top 9 billionaires is equivalent to the wealth of the bottom 50 per cent of the population," Between 2018 and 2022, India is estimated to produce 70 new dollar millionaires every day,
The CEO of ‘Oxfam India’ CEO Amitabh Behar adds, “It (the study) reveals how governments are exacerbating inequality by underfunding public services, such as healthcare and education, on the one hand, while under taxing corporations and the wealthy, and failing to clamp down on tax dodging on the other. It also shows that women and girls are hardest hit by rising economic inequality”.
The Report also asserted that in countries like India, a decent education or quality healthcare has become a luxury only the rich can afford. "Children from poor families in India are three times more likely to die before their first birthday than children from rich families," it added. Millions of India’s poor struggle to find their next meal or pay for medicines. The situation of the girl child and women in general is pitiable! In India, women are still receiving 34% less wages than their male counterparts for the same work. The Report also highlights the painful reality that in India “inequality is also very sexist” Inequality in India is based not just on class but caste, but gender as well. “A Dalit woman can expect to live almost 14.6 years less than one from a high-caste,” the report says, asserting that this inequality costs India its human potential. Regarding unpaid care work, the report says that Indian women spend around three hours on it daily while it’s just around 30 minutes for men. This often discourages women from joining the labour force and earning decent wages . “Unpaid care is a huge hidden subsidy to the economy, which is ignored by standard economic analysis,” it adds. Lack of or poor funding and privatisation of public services, gender inequality leading to violence against women, the burden of unpaid care work, fiscal injustice for women and other marginalised groups, and corruption are listed as the major reasons for increasing wealth inequality in India.
Highlighting the shortage of health specialists in rural areas, the report compares India’s 0.7 doctors per 1,000 people to the UK’s 2.8. It further states that “ most insurance schemes (including the new Ayushman Bharat) fail to cover outpatient costs that account for 68% of expenses.” While India boasts of “world class health services at low cost” and ranks 5th on the Medical Tourism Index, in terms of quality and accessibility of healthcare to its own citizen, it ranks 145th among 195 countries. The dropping enrolment ratio in government schools, particularly for girls, while private schools see an uptick in admission, points to the state’s neglect, the report suggests. It further says that private players in health and education are often unregulated or under-regulated, leading to exorbitant profit margins and hence, exclusion.
Besides the addition to the figures explaining the extent of wealth inequality, the study also has strong and serious recommendations for the government of India to move towards a fairer society; for example “ Getting the richest one percent in India to pay just 0.5 percent extra tax on their wealth could raise enough money enough to increase government spending on health by 50 percent,” Other recommendations include progressively making school education free, ensuring reduced out of pocket expenses on health, and meeting global benchmarks of 6% and 3.5% of GDP on education and public health respectively. It also emphasizes the urgency of strengthening quality public healthcare, strict enforcement of the Right to Education norms, stopping commercialisation of education and health, and an increased focus on gender budgeting. It recommends revising the NSSO definition of ‘work’ to include domestic work as an economic activity. A policy framework to recognise care as a universal right guaranteed by the state through an effective social protection system is also recommended.
That this current Government, given the fact that it is wedded to crony capitalism and to corruption, will not pay heed to the recommendations is a certainty. Demonetization, the way the RBI Governors were hounded out, the privileges given to a select few, the rampant financial scams including the Rafale jet deal, the scandalous profits made by those who are close to the ruling bigwigs- are there for all to see. Stories of financial irregularities and blatant corruption which sneak their way into some media- are immediately shot down or kept in limbo. Even Supreme Court judges are blackmailed into giving favourable judgements because of some corrupt deeds of the past – either done by themselves or some other close relative. The Government in the last five years has increased its expenditure in military warfare tremendously, whilst important and much needed expenditure for the social sector has gone down tremendously.
Last month, in a well-publicized interview with the NDTV, renowned economist Mr. Raghuram Rajan, who was the former Governor of the Reserve of India said, “The three biggest problems for the economy are farmers' distress, power sector and crisis in the banking system. Lack of jobs is a very serious issue. This reflects the problems that even at 7 per cent growth, it is not producing the jobs. (This year) 25 million people applying for 90,000 railway jobs - that seems to me a reflection of the fact that we have a real job problem".
As the General Elections draw near, most of the people of India are now totally convinced that the “acchhe din” promised was only for a small coterie of crony capitalists, those who have escaped India with an unbelievable amount of loot, and those who have their black money stashed in foreign banks or hedge funds. It is now the responsibility of the Indian voter to ensure that the next Government will be one that will deliver on promises: to the farmers, to the unemployed, to the poor and marginalized. Above all, it will have to be a Government that will be able to reduce the gap between the rich and poor and ensures that the terrible tag “morally outrageous” disappears as soon as possible!
(The writer is a human rights activist. Contact: firstname.lastname@example.org)
(Published on 28th January 2019, Volume XXXI, Issue 05)