India ranks 4th in income equality globally, says World Bank report

Business Standard

12 hours ago

India has been ranked fourth in income equality globally with a score of 25.5 on the Gini Index after Slovak Republic (24.1), Slovenia (24.3), and Belarus (24.4), emerging as one of the world's most equal societies, especially remarkable for a country of India's size and diversity, according to a report by the World Bank.
India's progress in achieving this balance is the result of sustained economic growth paired with targeted social policies focused on reducing poverty and expanding financial access, the report said.
What is Gini index?
The Gini Index measures the distribution of income, wealth, or consumption across a population. A score of 0 represents perfect equality, while 100 reflects absolute inequality — where one individual holds all the resources. A lower score signifies a more equitable society. With a Gini score of 25.5, India falls into the 'moderately low' inequality bracket (25–30) and is on the threshold of joining the 'low inequality' group.
Comparison with other nations
India's Gini Index not only places it ahead of China (35.7) and the United States (41.8), but also makes it more equal than every G7 and G20 country. The list of 'moderately low' inequality countries includes European nations like Iceland, Norway, Finland, and Belgium, as well as the UAE and Poland. In total, only 30 countries fall into this category globally.
India's current score marks a notable improvement from 28.8 in 2011, indicating a steady trend toward more equitable distribution of resources over the past decade.
Poverty reduction fuelling equality
India's improved equality metrics are closely tied to a significant reduction in poverty. According to the World Bank's Spring 2025 Poverty and Equity Brief, 171 million Indians exited extreme poverty over the past 10 years. The share of people living on less than $2.15 per day — the previous global benchmark for extreme poverty — fell from 16.2 per cent in 2011-12 to just 2.3 per cent in 2022-23. Using the revised threshold of $3.00 per day, India's poverty rate is estimated at 5.3 per cent.
This success has been supported by government initiatives designed to reach the most vulnerable sections of society.
Key government schemes driving inclusion
Several flagship schemes have contributed to improving financial access, welfare delivery, and entrepreneurship among marginalised groups:
-PM Jan Dhan Yojana: Over 556.9 million bank accounts opened, expanding financial inclusion
-Aadhaar: More than 1,420 million digital identities issued, streamlining benefits delivery
-Direct Benefit Transfer (DBT): ₹3.48 trillion in cumulative savings, reducing leakages in welfare schemes
-Ayushman Bharat: Health cover of ₹5 lakh per family, with over 413.4 million cards issued and 32,000 empanelled hospitals. The scheme includes a version for senior citizens aged over 70 years.