Inequality started to rise in India and China substantially in the early 1990s and 2000s, while it was stabilised in China, it continued to rise in India, according to a report. “In China, the top-1 per cent captured eight per cent of national income in 1990 and rose to 14 per cent in 2019, while in India, the corresponding figures are 11 per cent in 1990 and 21 per cent in 2019,” the World Inequality Lab said in the report.
It said while inequality started to rise in India and China substantially in the early 1990s and 2000s, it was stabilised in China but continued to rise in India. The report added that this suggests that development and higher growth rates do not necessarily mean more inequality in the distribution of growth. “As a matter of fact, national economic policies matter.” In both the countries, inequality increased substantially after the economic liberalisation of the 1980s and 1990s, it said.
The report said communist countries like China and Vietnam display lower inequality levels than non-communist countries like India and Thailand. They still display much higher levels of inequality as compared to the western europe, the least unequal region worldwide, it added. China and Vietnam also appear to be more unequal than post-communist eastern Europe but somewhat less unequal than post-communist Russia, it said.
According to the report, in the bottom 50 per cent, the population share of India as well as other South Asian economies have been expanding and contrasting to the sharp decline of the Chinese population share in this group. The World Inequality Lab is the open source for global inequality data, both within countries and between countries.
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