India Ranked 4th most equal country globally: World Bank

India has emerged as one of the most equal societies in the world, ranking 4th globally in terms of income equality, according to the latest data released by the World Bank. The ranking is based on the Gini Index, a globally recognized measure of income or wealth inequality across households or individuals within a country. India’s Gini Index currently stands at 25.5, placing it just behind the Slovak Republic (24.1), Slovenia (24.3), and Belarus (24.4)—the only three countries with a better score.

What is the Gini Index, and why is it important for measuring inequality?

The Gini Index is a statistical measure that ranges from 0 to 100:

• A score of 0 denotes perfect equality, where everyone has exactly the same income or wealth.

• A score of 100 indicates absolute inequality, where one person controls all the income or wealth.

With a score of 25.5, India falls into the “moderately low” inequality category (Gini scores between 25 and 30). This is a significant position given that the World Bank report includes data from 167 countries. India is now only a fraction away from entering the “low inequality” group—a category reserved for countries with scores below 25.

How has India’s Gini Index changed over the years?

India’s rise in equality is not sudden—it reflects a steady and sustained improvement over the past decade. In 2011, India's Gini Index was recorded at 28.8, meaning there has been a marked improvement in the equitable distribution of income and consumption.

This journey is also closely tied to a sharp decline in extreme poverty—defined by the World Bank as living on less than USD 2.15 per day (the global poverty threshold until June 2025). In 2011-12, 16.2% of Indians lived in extreme poverty. By 2022-23, this figure had dropped dramatically to just 2.3%. This means that 171 million Indians have been lifted out of extreme poverty in a span of just over a decade, making India one of the most significant contributors to global poverty reduction.

How does India compare with other major economies in terms of income equality?

India's performance is noteworthy when compared to other major economies:

• China, with a Gini Index of 35.7, shows significantly higher inequality.

• The United States fares even worse at 41.8, reflecting greater income disparity.

• India also ranks ahead of all G7 and G20 countries in income equality, demonstrating that economic development and equitable wealth distribution can go hand in hand.

What government schemes have contributed to reduced inequality in India?

This achievement has been largely attributed to a combination of strong policy direction, targeted welfare schemes, and an emphasis on inclusive economic growth. The Indian government, in collaboration with state agencies, has implemented several flagship programs that have boosted financial inclusion, streamlined welfare delivery, and empowered marginalized groups.

Key initiatives include:

• PM Jan Dhan Yojana: A nationwide financial inclusion program that has enabled over 55 crore people to open zero-balance bank accounts, giving them access to formal banking.

• Aadhaar Digital Identity: Covering over 142 crore Indians, it has transformed identity verification and helped in directly transferring benefits to verified individuals, reducing leakages and fraud.

• Direct Benefit Transfers (DBT): Using Aadhaar and bank integration, the DBT system has saved the government over ₹3.48 lakh crore (as of March 2023) by plugging inefficiencies.

• Ayushman Bharat: A public health insurance scheme providing ₹5 lakh coverage per family, with over 41 crore cards issued to date—bringing healthcare access to the underprivileged.

• PM Garib Kalyan Anna Yojana (PMGKAY): India’s flagship food security program, which has benefitted over 80 crore citizens by ensuring subsidized or free food grains.

• Stand-Up India and PM Vishwakarma Yojana: These schemes are designed to support self-employment and entrepreneurship among SC/ST individuals, women, and traditional artisans, by providing credit, skill training, and marketing support.

What makes India’s development model unique in terms of equality and growth?

What sets India apart is its ability to combine economic reform with social protection. While many countries experience rising inequality during periods of rapid economic growth, India’s example demonstrates that equity and development need not be opposing goals. Instead, with inclusive intent and sound policy, they can reinforce each other.

The World Bank's Spring 2025 Poverty and Equity Brief describes India as a model for balancing growth with fairness. The country’s success proves that broad-based development, backed by systematic reforms and social safety nets, can lead to tangible improvements in people’s lives.

How is India’s income equality reflected in real-life improvements?

India’s improved Gini Index isn’t just a statistic—it reflects real changes in people’s lives:

• More people now have access to banking, food, healthcare, education, and employment.

• Vulnerable groups are becoming economically self-reliant through entrepreneurship and skill-based training.

• Social protection programs have significantly improved the quality of life and reduced dependency on irregular income sources.

What does India’s Gini Index ranking mean for its global standing?

India’s Gini Index of 25.5 makes it the 4th most equal country in the world and the most equal among large economies. This shows the world that it is possible to achieve inclusive development at scale, even in a large, diverse, and rapidly growing country.

As other nations grapple with widening inequality, India’s policy-driven model—focusing on both economic opportunity and social justice—is increasingly being seen as a global benchmark.

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