In a significant global recognition, India has been ranked as the fourth most equal country in the world by the World Bank, outperforming major economies such as China and the United States in income equality metrics. The ranking is based on the Gini coefficient, a widely accepted measure of income distribution within a nation, where a lower value indicates more equitable wealth spread.
Understanding the ranking
According to the World Bank’s latest report, India’s Gini coefficient stands at approximately 0.35, which places it among the world’s most equal societies in terms of income. This remarkable achievement reflects India’s targeted welfare schemes, inclusive economic policies, rural employment programmes, and progressive taxation structure.
The report places Slovakia, Slovenia, and Belarus as the top three most equal nations, with India securing fourth position, followed by countries like Czech Republic, Norway, and Finland. China’s Gini coefficient is reported at around 0.47, while the US is even higher at approximately 0.48, indicating greater income inequality.
What is Gini coefficient?
| Gini Coefficient Range | Meaning |
|---|---|
| 0 | Perfect equality (everyone has the same income) |
| 1 | Perfect inequality (one person has all income) |
| 0.20-0.35 | Generally indicates low income inequality |
| 0.36-0.50 | Medium to high inequality |
| Above 0.50 | Very high inequality |
India’s score places it at the cusp of low inequality countries, a rare feat for a large and diverse developing economy.
Key drivers of India’s equality ranking
- Direct Benefit Transfers (DBT): Schemes such as PM Kisan and Jan Dhan-Aadhaar-Mobile (JAM) trinity have ensured welfare payments reach intended beneficiaries without leakages.
- Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS): Has offered wage security to millions, lifting rural income floors.
- Food Security Act: Subsidised food grains for over 80 crore citizens has mitigated extreme poverty effects.
- Progressive taxation: The tax system combined with welfare subsidies has helped redistribute wealth.
- Digital financial inclusion: UPI and digital payments ecosystem have enabled small businesses, farmers, and micro-entrepreneurs to integrate into the formal economy.
Comparison with other countries
| Country | Gini Coefficient | Equality Rank |
|---|---|---|
| Slovakia | 0.24 | 1 |
| Slovenia | 0.25 | 2 |
| Belarus | 0.27 | 3 |
| India | 0.35 | 4 |
| Czech Republic | 0.36 | 5 |
| China | 0.47 | 35 |
| US | 0.48 | 37 |
| Brazil | 0.53 | 50 |
| South Africa | 0.63 | 65 |
Expert reactions
Economists and policymakers have hailed the report as a validation of India’s welfare-driven development model. Dr. Ramesh Chand, NITI Aayog member, stated:
“Our targeted approach to uplift the bottom quintile through direct transfers, food security, rural employment, and social welfare has kept inequality in check despite rapid economic growth.”
Former Chief Economic Adviser Dr. Arvind Subramanian, however, cautioned:
“While the Gini coefficient indicates income distribution, India must continue to focus on absolute poverty reduction and job creation to sustain inclusive growth.”
Challenges ahead despite equality gains
While India’s relative income equality is commendable, experts note challenges such as:
- Persistent unemployment among youth and graduates
- Stagnant rural wages in certain states
- High informal sector employment with limited social security
- Regional disparities, particularly in tribal and remote districts
Government initiatives reinforcing equality
The Modi government has accelerated schemes aimed at balanced growth:
- PM Vishwakarma Yojana: Support to traditional artisans and micro-entrepreneurs.
- Skill India Mission: Enhancing employability for rural and urban youth.
- Affordable Housing under PMAY: Ensuring housing security for economically weaker sections.
- Ayushman Bharat: Providing health insurance cover to over 50 crore citizens.
- National Education Policy (NEP) 2020: Aiming to reduce urban-rural education gaps.
International perspective
World Bank Chief Economist for South Asia Hans Timmer noted:
“India has successfully combined economic growth with targeted poverty reduction and social protection policies, keeping inequality from rising despite its size and diversity.”
In contrast, the US and China have seen widening income gaps due to rapid capital accumulation by top deciles, urban-rural divides, and relatively weaker social protection nets compared to Europe or India.
Political reactions in India
The ruling BJP hailed the report as proof of “Sabka Saath, Sabka Vikas” delivering tangible outcomes. Finance Minister Nirmala Sitharaman tweeted:
“World Bank data validates India’s inclusive growth model where welfare and development go hand in hand.”
Opposition parties welcomed the report but highlighted persisting poverty and unemployment challenges. Congress spokesperson Supriya Shrinate stated:
“We welcome reduced inequality, but the government must urgently address rising joblessness and economic distress faced by MSMEs.”
Social media trends
The news of India ranking 4th in equality triggered massive discussion online. Hashtags like #InclusiveIndia, #WorldBankReport, and #SabkaVikas trended on Twitter, with citizens expressing pride as well as calls for deeper reforms in job creation and education quality.
Final thoughts
India’s ranking as the fourth most equal country in the world is a landmark recognition, showcasing how welfare schemes, social security, and direct transfers have kept inequality in check even as the economy grows at over 7%. Moving forward, the challenge remains to combine this equitable income distribution with rapid job creation, skilling, and regional development, to ensure holistic prosperity.
Disclaimer: This news article is for informational purposes only. It includes official data, expert analyses, and public statements based on the World Bank’s income inequality report. Final policy conclusions and rankings remain subject to formal publication and periodic updates by global institutions.
