ECONOMIC INEQUALITY

India’s rising inequality is taking the shine off its growth story even in the world’s eyes

India has attracted negative attention in recent years as the second most unequal country in the world, after Russia.

Spectacular economic growth over the past three decades has made India a global economic powerhouse. Between 1990 and 2016, India’s economy grew at a compound rate of around 7% in current dollars. The Indian economy is now the third largest in the world by purchasing power parity after China and the United States.

Slow trickle: India’s wealth is concentrated with 80% held by 10% of the population. The first decile controls a negative percentage due to debt amounting to US$21 billion. Source: Oxfam Briefing Paper: An Economy for the 99%
Slow trickle: India’s wealth is concentrated with 80% held by 10% of the population. The first decile controls a negative percentage due to debt amounting to US$21 billion. Source: Oxfam Briefing Paper: An Economy for the 99%

The surging economic growth has improved living conditions of its citizens, but these improvements were not uniformly distributed among India’s diverse population. Despite being among the richest countries in the world, India has attracted negative attention in recent years as the second most unequal country in the world, after Russia.

According to the Credit Suisse Research Institute, the top 1% of India’s population owns nearly 60% of its wealth, trailing Russia, where the top 1% owns 74% Like the Gini index which measures income/wealth distribution in society, the Credit Suisse Index estimates concentration of wealth among top wealth and income holders. The factors affecting wealth/income concentration include economic growth rate, demographic trends, savings rates, globalization, inheritance and government policies.

Since 1990, the per-capita gross domestic product has increased almost six times – from $1,130 to $6,572. Life expectancy, infant and maternal mortality, sanitation, mean years of schooling and female literacy registered significant improvements for the population of more than 1.3 billion. In all these areas, improvements were better than in its two large South Asian neighbors, Pakistan and Bangladesh.

In India, the upper classes were the main beneficiary of the nation’s surging economic development and poverty rates are also significantly lower among the upper caste Hindus rather than the Hindu other backward classes, the scheduled castes and scheduled tribes, and Muslims. One third of Muslim and Hindu scheduled castes and tribes are in poverty compared to 10% of the upper castes Hindu. Altogether, 28% or around 360 million Indians are living in conditions of severe poverty.

Two extremes

While economic growth is absolutely crucial in raising living standards of India’s vast population, the distributional effects of economic growth, as measured by income distribution, play a significant role in determining the long-term development trends and socio-economic well-being of the citizens. India is one the richest countries in the world, and yet, the average Indian is relatively poor as a result of highly-skewed income distribution.

According to the latest data from Credit Suisse and Oxfam, the richest 10% of Indians own 80% of the country’s wealth. At the other end, the poorer half jostles for a mere 4.1% of national wealth. Even more strikingly, during the period of India’s rapid economic growth, the rich have been the greatest beneficiaries. Between 2000 and 2016, the share of India’s richest 1% increased from 36.8% over 50%. The rising income inequality has developmental implications – leading to slower poverty reduction and undermining sustainability of economic growth.

Growing problem: Inequality is increasing in India and elsewhere around the globe. Source: Manas Chakravarty and IMF
Growing problem: Inequality is increasing in India and elsewhere around the globe. Source: Manas Chakravarty and IMF

Increasing wealth concentration is also reflected in income growth. Between 1988 and 2011, the incomes of the poorest 10% of Indians rose by $29, or around ₹2,000, at an increase of 1% per year. In the same period, the income of the richest 10% increased by almost ₹40,000, at the rate of 25% per year. The reasons for this inequality include crony capitalism and corporations that exploit employees at lower rungs to maximise salaries and dividends for executives and shareholders. As the French economist Thomas Piketty shows in his seminal book, Capital in the Twenty-First Century, the surest way to grow wealth is to possess it.

The rapid rise of income inequality is reflected in changes in the more traditional Gini Index. Between 1990 and 2013, the increase in the Gini coefficient was one of the highest not only in Asia, but also in the world. Interestingly, in the period when India’s Gini coefficient was rising, it was declining in other highly unequal regions such as Latin America and Africa.

The state of the middle class

Higher income inequality impedes class formation and poverty reduction. In particular, the growth of the middle class plays a significant role in strengthening democratic structures and cultures. But rising income inequality in India is hampering the formation and growth of the middle class. If one were to take an income of $10-$20 per day in 2011 purchasing power parity as an indicator of the middle class, then India has not done as well as Malaysia, Indonesia and China in growing its middle class. According to the International Monetary Fund, the higher income inequality has lowered the effectiveness of growth to combat poverty and significantly slowed the building of a sizeable middle class in India.

Economic test: Compared with other emerging economies in Asia, India struggles to build a middle class. Source: Manas Chakravarty and IMF
Economic test: Compared with other emerging economies in Asia, India struggles to build a middle class. Source: Manas Chakravarty and IMF

Rising income inequality has developmental implications. The super-rich can avoid taxes by using innovative schemes to shelter their wealth and manipulate the political system without repercussions. This impedes the government’s ability to raise revenues that contribute to slower poverty reduction and also adversely impacts social spending to reduce social inequalities of health, education and employment. India already fairs poorly in this area. Currently, 3% of the GDP goes towards education and only 1.3% towards health. By comparison in China, percentage of GDP allocated to education and health is 4.3 and 5.4, respectively.

Economic inequality can adversely exacerbate a range of social problems, including inter-group relations and conflict, social cohesion and violent crime. Inequality hurts not only the poor but everyone with increased crime and increased workplace accidents. India ranks 125 out of 159 countries in the Gender Inequality Index. In a range of indicators including mean years of schooling, gross national income per capital and labor force participation rates, Indian women lag significantly behind Indian men. Cumulative effects of entrenched inequality will worsen their deprivations. Inequality is also affecting India’s urban landscape. Recent studies show that class, ethnicity and caste inequalities represent the growing axis of residential segregation in contemporary urban India.

This article first appeared on YaleGlobal Online.

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Swara Bhasker: Sharp objects has to be on the radar of every woman who is tired of being “nice”

The actress weighs in on what she loves about the show.

This article has been written by award-winning actor Swara Bhasker.

All women growing up in India, South Asia, or anywhere in the world frankly; will remember in some form or the other that gentle girlhood admonishing, “Nice girls don’t do that.” I kept recalling that gently reasoned reproach as I watched Sharp Objects (you can catch it on Hotstar Premium). Adapted from the author of Gone Girl, Gillian Flynn’s debut novel Sharp Objects has been directed by Jean-Marc Vallée, who has my heart since he gave us Big Little Lies. It stars the multiple-Oscar nominee Amy Adams, who delivers a searing performance as Camille Preaker; and Patricia Clarkson, who is magnetic as the dominating and dark Adora Crellin. As an actress myself, it felt great to watch a show driven by its female performers.

The series is woven around a troubled, alcohol-dependent, self-harming, female journalist Camille (single and in her thirties incidentally) who returns to the small town of her birth and childhood, Wind Gap, Missouri, to report on two similarly gruesome murders of teenage girls. While the series is a murder mystery, it equally delves into the psychology, not just of the principal characters, but also of the town, and thus a culture as a whole.

There is a lot that impresses in Sharp Objects — the manner in which the storytelling gently unwraps a plot that is dark, disturbing and shocking, the stellar and crafty control that Jean-Marc Vallée exercises on his narrative, the cinematography that is fluid and still manages to suggest that something sinister lurks within Wind Gap, the editing which keeps this narrative languid yet sharp and consistently evokes a haunting sensation.

Sharp Objects is also liberating (apart from its positive performance on Bechdel parameters) as content — for female actors and for audiences in giving us female centric and female driven shows that do not bear the burden of providing either role-models or even uplifting messages. 

Instead, it presents a world where women are dangerous and dysfunctional but very real — a world where women are neither pure victims, nor pure aggressors. A world where they occupy the grey areas, complex and contradictory as agents in a power play, in which they control some reigns too.

But to me personally, and perhaps to many young women viewers across the world, what makes Sharp Objects particularly impactful, perhaps almost poignant, is the manner in which it unravels the whole idea, the culture, the entire psychology of that childhood admonishment “Nice girls don’t do that.” Sharp Objects explores the sinister and dark possibilities of what the corollary of that thinking could be.

“Nice girls don’t do that.”

“Who does?”

“Bad girls.”

“So I’m a bad girl.”

“You shouldn’t be a bad girl.”

“Why not?”

“Bad girls get in trouble.”

“What trouble? What happens to bad girls?”

“Bad things.”

“What bad things?”

“Very bad things.”

“How bad?”

“Terrible!!!”

“Like what?”

“Like….”

A point the show makes early on is that both the victims of the introductory brutal murders were not your typically nice girly-girls. Camille, the traumatised protagonist carrying a burden from her past was herself not a nice girl. Amma, her deceptive half-sister manipulates the nice girl act to defy her controlling mother. But perhaps the most incisive critique on the whole ‘Be a nice girl’ culture, in fact the whole ‘nice’ culture — nice folks, nice manners, nice homes, nice towns — comes in the form of Adora’s character and the manner in which beneath the whole veneer of nice, a whole town is complicit in damning secrets and not-so-nice acts. At one point early on in the show, Adora tells her firstborn Camille, with whom she has a strained relationship (to put it mildly), “I just want things to be nice with us but maybe I don’t know how..” Interestingly it is this very notion of ‘nice’ that becomes the most oppressive and deceptive experience of young Camille, and later Amma’s growing years.

This ‘Culture of Nice’ is in fact the pervasive ‘Culture of Silence’ that women all over the world, particularly in India, are all too familiar with. 

It takes different forms, but always towards the same goal — to silence the not-so-nice details of what the experiences; sometimes intimate experiences of women might be. This Culture of Silence is propagated from the child’s earliest experience of being parented by society in general. Amongst the values that girls receive in our early years — apart from those of being obedient, dutiful, respectful, homely — we also receive the twin headed Chimera in the form of shame and guilt.

“Have some shame!”

“Oh for shame!”

“Shameless!”

“Shameful!”

“Ashamed.”

“Do not bring shame upon…”

Different phrases in different languages, but always with the same implication. Shameful things happen to girls who are not nice and that brings ‘shame’ on the family or everyone associated with the girl. And nice folks do not talk about these things. Nice folks go on as if nothing has happened.

It is this culture of silence that women across the world today, are calling out in many different ways. Whether it is the #MeToo movement or a show like Sharp Objects; or on a lighter and happier note, even a film like Veere Di Wedding punctures this culture of silence, quite simply by refusing to be silenced and saying the not-nice things, or depicting the so called ‘unspeakable’ things that could happen to girls. By talking about the unspeakable, you rob it of the power to shame you; you disallow the ‘Culture of Nice’ to erase your experience. You stand up for yourself and you build your own identity.

And this to me is the most liberating aspect of being an actor, and even just a girl at a time when shows like Sharp Objects and Big Little Lies (another great show on Hotstar Premium), and films like Veere Di Wedding and Anaarkali Of Aarah are being made.

The next time I hear someone say, “Nice girls don’t do that!”, I know what I’m going to say — I don’t give a shit about nice. I’m just a girl! And that’s okay!

Swara is a an award winning actor of the Hindi film industry. Her last few films, including Veere Di Wedding, Anaarkali of Aaraah and Nil Battey Sannata have earned her both critical and commercial success. Swara is an occasional writer of articles and opinion pieces. The occasions are frequent :).

Watch the trailer of Sharp Objects here:

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This article was published by the Scroll marketing team with Swara Bhasker on behalf of Hotstar Premium and not by the Scroll editorial team.