India Emerges as a Global Leader in Income Equality
India has achieved significant progress in income equality, ranking fourth globally with a Gini Index of 25.5, according to the latest World Bank data. The country’s success is attributed to robust poverty reduction and inclusive financial policies.
Income EqualityGini IndexPoverty ReductionFinancial InclusionSocial WelfareReal EstateJul 06, 2025
Ranking fourth worldwide in income equality, India now stands just behind the Slovak Republic, Slovenia, and Belarus. “It reflects how India’s economic progress is being shared more evenly across its population. Behind this success is a consistent policy focus on reducing poverty, expanding financial access, and delivering welfare support directly to those who need it most,” a release from the Social Welfare said.
The Gini Index, a key measure of income distribution where 0 represents perfect equality and 100 denotes maximum inequality, places India ahead of advanced economies, including China (35.7), the United States (41.8), and all G7 and G20 countries. India’s score has improved from 28.8 in 2011, reflecting steady progress in equitable growth.
The country’s strong performance in reducing poverty has played a central role in achieving greater equality. The World Bank’s Spring 2025 Poverty and Equity Brief reports that 171 million Indians were lifted out of extreme poverty between 2011 and 2023. The poverty rate fell sharply from 16.2 per cent to just 2.3 per cent during this period, based on the USD 2.15 per day global poverty threshold.
Government initiatives have underpinned this transformation. Flagship programs like PM Jan Dhan Yojana have expanded financial inclusion, with over 55 crore bank accounts. Aadhaar, India’s digital ID system, now covers more than 142 crore individuals, streamlining welfare delivery through Direct Benefit Transfers, which saved Rs 3.48 lakh crore by March 2023.
India’s commitment to equitable growth is evident in its comprehensive approach to social welfare and economic policies. The government’s focus on digital transformation, financial inclusion, and targeted welfare programs has been instrumental in reducing inequality and improving the quality of life for millions of Indians.
Looking ahead, the Indian government is expected to continue its efforts to ensure that the benefits of economic growth are shared more widely. This includes further enhancing financial inclusion, expanding access to education and healthcare, and implementing policies that promote sustainable and inclusive development.
The success in achieving income equality is not only a testament to India’s economic policies but also a model for other developing nations striving to reduce poverty and inequality. As India continues to grow and develop, it is poised to maintain its position as a global leader in income equality.
Frequently Asked Questions
What is the Gini Index and what does it measure?
The Gini Index is a measure of income distribution within a country, where 0 represents perfect equality and 100 denotes maximum inequality. It helps in understanding how evenly income is distributed among the population.
How has India's Gini Index improved over the years?
India's Gini Index has improved from 28.8 in 2011 to 25.5 in the latest World Bank data, reflecting steady progress in equitable growth and poverty reduction.
What are the key government initiatives that have contributed to India's income equality?
Key government initiatives include PM Jan Dhan Yojana for financial inclusion, the Aadhaar digital ID system for welfare delivery, and various poverty reduction programs.
What is the current poverty rate in India and how has it changed over time?
The poverty rate in India has fallen sharply from 16.2 per cent in 2011 to just 2.3 per cent in 2023, based on the USD 2.15 per day global poverty threshold.
How does India's income equality compare to other major economies?
India ranks fourth globally in income equality, ahead of advanced economies like China (35.7), the United States (41.8), and all G7 and G20 countries.
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