Skewed growth and deepening disparities

Inequalities in education, healthcare, nutrition, and digital access hinder prospects of equitable growth in India

In the Spanish dystopian film The Platform, Imoguiri, one of the characters, observes: “If everyone ate only what they needed, the food would reach the lowest levels.” The movie is themed around a vertical facility where those at the top levels consume far more than they need, leaving residents of the levels below progressively underfed, mirroring real-world inequality.

The World Inequality Report 2023 highlights a similar phenomenon in India, where the top 10 per cent of the population hold 57.1 per cent of the total income and 64.6 per cent of the wealth, while the bottom 50 per cent control only 13.1% of the income and a mere 5.9 per cent of the wealth. India is ranked 111th out of 125 countries in the 2023 Global Hunger Index.

There is no denying that India is making strides in economic growth, positioning itself as the world’s fifth-largest economy, and aiming for a $5 trillion economy. But will this economic expansion bridge the vast income and wealth disparity between the top 10 per cent and the bottom 50 per cent which struggle to meet necessities like food, clothing, education, healthcare, sanitation, clean cooking fuel, and housing?

A study from the World Inequality Lab found that “The Billionaire Raj headed by India’s modern bourgeoisie is now more unequal than the British Raj headed by the colonialist forces.” According to the Hurun Research Institute’s 2024 global rich list, India’s current number of billionaires is 271, with 97 new billionaires added in 2023 alone. It has more new billionaires than any country other than the US.

As emphasised by the World Inequality Lab report headed by economist Thomas Piketty, the increase in inequality has become a significant concern, especially over the past decade since the National Democratic Alliance first came to power in 2014.

Major political and economic reforms during this period have facilitated the concentration of decision-making power in the hands of the government and created a nexus between big businesses and the state.

This centralisation of power and close government-business relations have widened economic disparities. While economic growth is often seen as a means to improve the standard of living, in India, the benefits of globalisation and development have failed to reach all sections of society.

The structural inequalities in education, healthcare, nutrition, and digital access, compounded by regional and socio-economic disparities, form the core challenges to equitable growth in the country. Understanding these factors is crucial to addressing the deep-rooted inequalities that plague India and ensuring sustainable and inclusive development.

Investing in higher education is widely recognised as a powerful tool to promote economic growth and reduce inequalities. However, despite rapid expansion in the higher education sector over the last few decades, access remains unequal. In 1950-51, only 0.26 million students were enrolled in 30 universities and 750 colleges but by 2015-16, this had grown to 34.6 million across 39,071 colleges and 11,923 institutions.

Though the Gross Enrolment Ratio (GER) in higher education has improved from 0.4% in 1950-51 to 25 per cent in 2016-17, marginalised communities such as Scheduled Castes (SC), Scheduled Tribes (ST), Other Backward Classes (OBCs), Muslims, and rural populations are still significantly underrepresented. Entry into elite public institutions is dominated by students from well-off families. Furthermore, the privatisation of higher education has increased the financial burden on students and made these private institutions inaccessible to low-income families.

Failing healthcare systems

Inequities in healthcare are a significant barrier to achieving social equality. India’s underfunded public healthcare system forces many of the population to rely on expensive private healthcare providers.

Out-of-pocket health expenses comprise 64.2 per cent of total health expenditures, well above the global average of 18.2 per cent.

Government estimates suggest that 63 million people are pushed into poverty every year due to healthcare costs, with 74 per cent of the hospitalisations financed through personal savings and 20 per cent through loans.

The lack of affordable healthcare is particularly harsh in rural areas, where the primary sources of financing healthcare include mortgaging jewellery, selling assets, and borrowing at high interest.

India’s malnutrition crisis further reflects its inequality. Although nutrition indicators have improved for all communities, the gap between marginalised groups and upper-caste Hindus remains substantial.

For instance, stunting rates – a key indicator of chronic malnutrition – stand at 40 per cent among Scheduled Castes and Scheduled Tribes, compared to 30 per cent among upper-caste groups. Regional inequalities compound these disparities: Bihar’s stunting rate (43 per cent) is almost double that of Kerala (23 per cent), and rural areas exhibit higher malnutrition rates (37 per cent) than urban areas (30 per cent).

Addressing malnutrition requires more than economic growth; it demands targeted interventions that address social and economic marginalisation by caste, class, and region.

Digital illiteracy and limited internet access have exacerbated existing socio-economic inequalities, leaving large sections of the population behind in the digital economy. Government programmes like BharatNet aimed to provide rural connectivity have fallen short, further isolating disadvantaged communities from education, healthcare, and employment opportunities that are increasingly shifting online.

Limited access to clean energy is another concern. Despite government efforts through schemes like the Pradhan Mantri Ujjwala Yojana (PMUY) to provide free LPG connections to poor households, many rural families still rely on traditional fuels.

India’s rising inequality is rooted in inadequate public healthcare, education, nutrition, and digital infrastructure investments. The growing power of billionaires and their close association with the government have further tilted the economic balance, favouring the capitalists. Wealth concentration and the inability to secure high levels of domestic investment have undermined inclusive economic growth, as reflected in the worsening living conditions of people experiencing poverty. The solution to inequality in India lies in greater public investment in healthcare, education, and infrastructure, especially in rural areas. Strengthening public healthcare, ensuring universal access to quality education, and closing the digital divide are essential to achieving social equality. Addressing these challenges requires restructuring policy priorities to ensure that the benefits of globalisation and economic growth reach the elites and the poorest sections of society. An unbiased approach toward the rich and poor will ensure that government support is directed where needed, helping build a more inclusive and equitable India.

(Maya K is an assistant professor at the Department of Economics, Christ deemed to be university and Kumar is a PhD scholar at the Department of Econometrics, University of Madras)