News Highlights
The State of Inequality in India Report was released today by Dr Bibek Debroy, Chairman, Economic Advisory Council to the Prime Minister (EAC-PM).
State of Inequality in India Report
- The report is written by the Institute for Competitiveness
- The report combines data on inequality in the health, education, household characteristics, and labour market sectors. Inequities in these sectors, according to the research, render the population more vulnerable and lead to multidimensional poverty.
- The report consisting of two parts – Economic Facets and Socio-Economic Manifestations – the report looks at five key areas that influence the nature and experience of inequality which include
- Income distribution
- Labour market dynamics
- Health
- Education
- Household characteristics.
- Sources of Data Used
- Periodic Labour Force Survey (PLFS), National Family and Health Survey (NFHS) and Unified District Information System for Education (UDISE) Plus.
Findings of Report
- The research broadens the narrative on inequality by providing a complete analysis that shapes the country’s ecosystem of diverse deprivations, which has a direct impact on the population’s well-being and overall growth.
- It’s a research that looks at how inequality affects society across the intersections of class, gender, and region.
- Wealth Estimates
- The paper presents just a limited picture of income distribution estimates for the years 2017-2018, 2018-19, and 2019-20.
- The paper emphasises that wealth concentration as a measure of inequality does not indicate changes in household purchasing power, and it focuses for the first time on income distribution to understand capital movement.
- Extrapolation of income data from Periodic Labour Force Survey (PLFS) 2019-20 has revealed that a monthly salary of Rs 25,000 is already among the top 10% of overall earnings, indicating some levels of income discrepancy.
- The top 1% earns 6-7% of all income, while the top 10% earn one-third.
- Employment
- Self-employed workers (45.78 percent) had the highest percentage of self-employed workers in 2019-20, followed by regular paid workers (33.5 percent), and casual workers (33.5 percent) (20.71 percent ).
- In the lowest income groups, the percentage of self-employed workers is also the largest.
- The unemployment rate in the country is 4.8 percent (2019-20), and the worker population ratio is 46.8%.
- Health Infrastructure
- There has been significant progress in increasing health infrastructure capacity, with a particular focus on rural areas.
- In 2005, there were 1,72,608 total health centres in India; by 2020, there would be 1,85,505.
- Between 2005 and 2020, states and union territories such as Rajasthan, Gujarat, Maharashtra, Madhya Pradesh, Tamil Nadu, and Chandigarh expanded the number of health centres (which include Sub-Centres, Primary Health Centres, and Community Health Centres).
- According to the NFHS-4 (2015-16) and NFHS-5 (2019-21) findings, 58.6% of women received prenatal check-ups in the first trimester in 2015-16, increasing to 70% in 2019-21.
- Within two days of delivery, 78.1 percent of women received postnatal care from a doctor or auxiliary nurse, and 78.1 percent of infants received postnatal care.
- However, as the report indicates, nutritional deficiency in terms of overweight, underweight, and anaemia prevalence (particularly in children, teenage girls, and pregnant women) are major concerns that require immediate attention.
- Furthermore, insufficient health coverage, which leads to high out-of-pocket expenses, has a direct impact on poverty rates.
- Education
- Education and household conditions have vastly improved as a result of targeted efforts through many social protection systems, particularly in the areas of water availability and sanitation, which have raised the living quality.
- It is emphasised that early childhood education and cognitive development are long-term corrective measures for inequality. 95 percent of schools will have functional bathroom facilities on campus by 2019-20 (95.9% functional boy’s toilets and 96.9% functional girl’s toilets).
- States and Union Territories such as Goa, Tamil Nadu, Chandigarh, Delhi, Dadra and Nagar Haveli and Daman and Diu, Lakshadweep, and Puducherry have attained universal (100 percent) coverage of functional power connections.
- Between 2018-19 and 2019-20, the Gross Enrolment Ratio grew in elementary, upper primary, secondary, and higher secondary schools.
- In terms of improving household conditions, a focus on providing sanitation and safe drinking water has allowed most people to live in dignity.
- According to the National Family Health Survey-5 (2019-21), 97 percent of families have access to power, 70 percent have improved sanitation, and 96 percent have safe drinking water.
Recommendation to Solve Issues
- To eliminate inequality in India, the Economic Advisory Council to the Prime Minister (EAC-PM) recommended that the government create a guaranteed job scheme for the unemployed in cities, as well as provide a universal basic income and dedicate more monies to the social sector.
- According to the report, boosting the minimum wage and implementing universal basic income are two ideas that can help close the income gap and ensure equal distribution of wages in the labour market.
- “Most significantly, the government must devote a higher percentage of spending to social services and the social sector in order to make the most vulnerable population more robust to shocks and prevent them from falling into poverty,” the report stated.
Way Forward
- The report highlights the prevalence of inequality in society and its solutions.
Pic Courtesy : freepik , Financial Express
Content Source : PIB