Gini Index
India has witnessed a remarkable decline in income inequality between 2011-12 and 2022-23. According to the World Bank, India now ranks as the fourth-most equal country worldwide based on the Gini Index. This progress coincides with a sharp reduction in extreme poverty. The government credits various welfare schemes and reforms for this achievement.
About the Gini Index
The Gini Index measures income or wealth distribution within a country. It ranges from 0 to 100, where 0 indicates perfect equality and 100 means total inequality. India’s Gini score has improved from 28.8 in 2011 to 25.5 in 2023. This places India in the moderately low inequality category, close to joining the low inequality group. Countries like Slovakia, Slovenia, and Belarus have slightly better scores. India fares better than China (35.7), the United States (41.8), and the United Kingdom.
Significant Poverty Reduction
Extreme poverty in India has dropped sharply in the last decade. The share of people living below USD 2.15 a day fell from 16.2% in 2011-12 to 2.3% in 2022-23. This translates to 171 million people lifted out of poverty. This reduction is a key factor in improving income equality. The global poverty threshold was revised to USD 2.15 in June 2025, reflecting inflation and cost of living changes.
Role of Government Initiatives
India’s progress is linked to targeted government schemes. These include PM Jan Dhan Yojana, Direct Benefit Transfer, and Stand-Up India. Such programmes improve financial inclusion, deliver welfare benefits efficiently, and support vulnerable groups. They help bridge economic gaps and promote equitable growth. The government’s approach combines economic reforms with strong social protection.
Global Context of Inequality
India is among 30 countries with moderately low inequality. This group includes European nations like Iceland, Norway, Finland, and Belgium. It also features growing economies such as Poland and wealthy countries like the United Arab Emirates. India’s improvement reflects steady progress in balancing growth with social equity.
Impact on Society and Economy
The decline in inequality means more families have access to food, banking, healthcare, and jobs. It signals real improvements in living standards. The shift in the Gini Index shows India’s ability to achieve inclusive growth. This balance is crucial for sustainable development and social stability.
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