French economist Thomas Piketty, along with a few other economists, recently came out with some startling findings on economic inequality trends in India over the last century. In Income and Wealth Inequality in India, 1922-2023: The Rise of the Billionaire Raj, Piketty and his co-authors estimate that inequality in India today is far worse than during the inter-war British colonial rule.
In 2022, the top 1% of the Indian population owned 40.1% of total wealth and earned 22.6% of total income, while the bottom 50% owned 6.4% of total wealth and earned 15% of total income. The fate of the bottom 50% looks even worse when compared with the top 10% who owned 65% of total wealth and earned 57.7% of total national income.
The authors use their findings to argue that India’s tax system, which is mostly based on people’s incomes, is regressive, and call for a wealth tax on the rich. While Piketty’s data might look alarming, it is crucial to question its use to justify wealth redistribution.
