The Inequality Paradox: Wealth Expansion and Distributional Inequality in India

Abstract Income inequality in India has emerged as one of the major challenges which have profound impact on shaping social conflict, political behaviour, economic policy, and patterns of development. India is one of the prime examples of unequal concentration of wealth where an estimated top 10% of the population enjoys the fruits of the more 77% of the country’s wealth while the bottom 50% has almost less than 3% of the country’s wealth, estimated by the recent report of the Oxfam International. The within country income inequality contributes to severe negative consequences such as weak human capital and generational inequality due to inequal access to education, disparities in health, rural urban divide, jobless growth, regional imbalances, gender inequality, social unrest and political polarization, inter-generational poverty, increased crime and eventually weakening of democratic political order. Should India more emphasize over addressing absolute poverty than inequality? Should India continuously consider the potential benefits of income inequality? Should India prioritize freedom of opportunities over social levelling? Is freedom really meaningful in the absence of basic equality? How about social inequalities limiting fair competition?