India’s income inequality has doubled over the last two decades, making it the worst performer in this category of all emerging economies. The top 10% of wage earners in India now make 12 times more than the bottom 10%, up from a ratio of six in the 1990s.
According to the Organisation for Economic Cooperation and Development (OECD) report, Divided We Stand: Why Inequality Keeps Rising, “the main driver [of this increasing ratio] has been the increase in wage inequality between regular wage earners and contractual employees hired over a period of time.”
“By contrast, inequality in the casual wage sector to workers employed on a day-to-day basis has remained more stable,” the report added, with India having by far the highest proportion of workers in informal employment by any national or international measure, as compared to other emerging economies.
There is also evidence of a growing concentration of wealth among the elite, says The Economic Times. The consumption of the top 20% of households grew by almost 3% per year in the 2000s as compared to 2% in the 1990s, while the growth in consumption of the bottom 20% of households remained unchanged at 1% per year.
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