Wealth inequality in India at an all-time high during covid

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NEW DELHI : Credit Suisse Global Wealth Report released on Tuesday showed that the Gini coefficient for India hit a peak of 82.3 in 2020 and remained the same at the end of 2021. The Gini coefficient is a measure of inequality with a higher figure denoting higher levels of inequality.

The Gini remained unchanged in 2021 from 2020 even as the household wealth in India saw a sharp jump for the same period. Total wealth in India was $14.2 trillion in 2021, up by 1.5 trillion or 12% from 2020, as per the report.

The report highlighted that India’s Gini coefficient has increased from 74.7 in 2000 to 82.3 in 2021.

Total wealth in India was $14.2 trillion in 2021, up by 1.5 trillion or 12% from 2020, as per the report.

Compared to other major fastest growing economies–China, Indonesia and Saudi Arabia–India’s Gini coefficient was the second highest, followed by Saudi Arabia at 86.4. The Gini coefficient for China and Indonesia was much lower at 70.1 and 78.2, respectively.

India added 107,000 millionaires in 2021 and accounted for at least 1% of total global millionaires. “The number of millionaires in India is expected to more than double to about 1.6 million by 2026,” as per the report. The wealth share of the top 1% Indians increased by 0.1% in 2021 to reach 40.6%. This number has steadily risen from 33.2% in 2000.

The hike in India’s household wealth in 2021 has come after a 6.1% slump recorded in 2020. This growth occurred on the back of a sharp rise of 31% in share prices.

 Aggregate global wealth recorded a rise of 9.8% or $41.5 trillion at prevailing exchange rates, to reach $463.6 trillion. “However, factors such as inflation, rising interest rates, and declining asset price trends could reverse last year’s impressive growth in 2022,” the report said.

 “On a country basis, the United States added the most household wealth in 2021, followed by China, Canada, India and Australia,” said Anthony Shorrocks, economist and report author. 

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