Of inequality and poverty

farmishedchildNotwithstanding Prime Minister Narendra Modi’s thundering declarations on tomorrow’s New India, the most critical issue of inequality has not drawn much of his government’s attention.

I am not questioning the Prime Minister’s honourable intentions. I am also not blaming him for the country’s growing inequality and its related phenomenon of poverty. It is the legacy of the Congress rule of over sixty years. It was Prime Minister Indira Gandhi who raised the war cry of “Garibi Hatao”, but without much result on the ground. Herein lies India’s tragedy.

The country’s political class has been following the one track approach of slogan mongering to take people on the garden path of Shining India but with a limited and lopsided success on the ground.

True, anti-poverty programmes have been launched at several stages of our history by different leaders with great fanfare. Still, the bitter truth is that the problem of poverty remains with us as acute as ever before. Nearly 300 millions of people (30 per cent) of the population are still struggling for two square meals a day.

The main reason for this situation is that the much-needed basic changes in the institutional structure have remained unattended. No wonder, the “inegalitarian structure” of our society has continued to grow. In due course, this has created “a long gap” between “verbalization” (of enactment of laws) and implementation of policies of reforms.

Even decentralization of power has not produced the desired results. If anything, it has led to concentration of power in the hands of “petty plutocracy”. I am sorry to say that Prime Minister Modi has also not given much thought to structural reforms necessary for handling the twin problems of poverty and inequality which are very much interlinked directly as well as indirectly. Therefore, we continue to see readymade poverty bazaar with hungry mouths, and famished and pot-bellied children. What can be more tragic than the fact that India still ranks 100th among 119 developing countries on the Global Hunger Index (GHI).

It so happens that the basic issue of poverty has got entangled in politics of our leaders, their cronies and half-baked and leaky programmes of poverty elimination. We have now disquieting reports of growing inequality in the country. What is not being realized by the ruling class is that the increasing inequality tends to slow down even the ongoing efforts on poverty reduction, apart from undermining the sustainability of economic growth.

The World Economic Forum’s Global Risks Report clearly states that economic inequality will lead to a wide range of health, education and social problems like mental illness and violent crimes.

The Johannesburg-based company New World Wealth report says that “India is the second-most unequal country globally, with millionaires controlling 54 per cent of its wealth. With a total individual wealth of $ 5,600 billion, it is among the 10 richest countries in the world and yet the average Indian is relatively poor”.

What a paradoxical situation! The latest data from Credit Suisse shows that the richest one per cent Indians own 53 per cent of the country’s wealth. Ironically, it is “far ahead of the United States where the richest one per cent own 37.3 per cent of total wealth. Even the paper by economists Thomas Piketty and Lucas Chancel tells us how the top one per cent has grown at 130 times of the bottom 50 per cent and the middle 40 per cent at a three times higher rate than the bottom half.

Of course, there may be varied angles of looking at inequality and poverty. For instance, economic liberalisation is said to have raised 138 million people above the poverty line between 2004 and 2011. The new opportunities emanating from liberalisation have even created 3,000 Dalit millionaires.

And in the changing socio-economic atmosphere, Dalits have begun to assert themselves in their search for freedom from social subjugation. Even in Gujarat, young Dalits stand up to the upper caste groups to defend their right to grow pointed moustaches.
These are happy signs of change in the old socio-economic order! Still, we cannot yet ignore the harsh fact that millions of people are still left behind in the country’s onward marches towards development.

According to Oxfam, this sharp rise of inequality in India…”will lead to slower poverty reduction, undermine the sustainability of economic growth, compound the inequalities between men and women, and drive inequalities in health, education and life chances”.

While working for policy changes, do India’s politico-bureaucratic masters take these harsh socio-economic facts into account? I doubt it. The country’s ruling class is known for its insensitivity towards the poor and the have-nots. We know how income disparities have been playing havoc in areas relating to education and health care, to the disadvantage of disprivileged sections of society.

What is particularly disappointing is that over three years of the Modi government has not proved to be any different from the earlier Congress regimes.

Not that the problem of economic inequality cannot be handled effectively. This is a matter of policy choices and reforms in taxation and social spending. First, tax reforms have to aim at redistribution of resources in such a way that profit- making companies and rich individuals pay more taxes and thereby help in redistribution of wealth rationally for the greater good of society. This is what I call a fair play in a developing society like India.

The 2017 Oxfam report says that India spends only three per cent towards education and 1.1 per cent towards health. Even South Africa spends much more on education and health. Is this not shameful? It shows lack of right political focus on the part of the Indian leadership. In the circumstances, how can India honour its global commitment of attaining the Sustainable Development Goals by 2030 and ending poverty for the 300 million people by that year? It is time Prime Minister Modi reviewed his lop-sided policies which, rightly or wrongly, give the impression of his tilt in favour of the rich.

It is good that Narendra Modi talks about all-inclusive growth. But how is it possible unless he makes “inclusion” and “income distribution” an integral part of  his national policy and economic reforms? The authorities need to realise that the ongoing widening income disparities will not only affect the economic growth but also endanger the country’s social stability. At stake is India’s honour and standing in the comity of nations as a country that cares for its citizens of all races and religions in a fair and just manner!

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