Oxfam reports states the obvious – the gulf between the rich and poor is getting wider

The gulf between the haves and have-nots have only widened in the country over the years and the pandemic made it worse. That is a general observation and now Oxfam report indicates the same. This does not augur well for the country which seeks to build an egalitarian society. According to the Oxfam report, economic inequality in India has sharply risen in the past five years. The COVID-19 pandemic only worsened the situation. The report cites various reasons for it including caste and class disparities, physical isolation of Scheduled Tribes (STs) from resources, caste entitlements and of course the skewed nature of economy.

One of the major indicators of economic inequality is income disparities which sharply rose due to the pandemic. COVID-19 has led to the diminishing of wealth for the bottom 50% of the Indian population. In 2020, their income share was only 13% of national income, and just 3% of national wealth. The pandemic accelerated the process of inequalities by throwing a large section of the society out of jobs due to lockdowns and fear psychosis. Thus the pandemic contracted the income and wealth of the bottom 50% of India. This is largely true for a large section of people are engaged in manual work which require presence on the work site like factories, shops, fields etc. Since most of these establishments were either closed or operated at bare minimal levels, the large sections were rendered jobless and had to survive on their savings. On the other hand people engaged in white collar jobs had their work going as the office work quickly shifted to online mode enabling them to ‘work from home’. Unfortunately the government didn’t do much to assuage the woes of the people engaged in blue collar jobs.Besides, we have an economy which is largely controlled by few individuals. The top 30% owns over 90% of India’s wealth. These figures top those of the pre-pandemic years (2018-19), which shows that the richest have only gotten richer during the pandemic. Another factor related to economic inequality in India is the hiking of the Goods and Services Tax (GST). The govt had reduced corporate tax slabs from 30% to 22%. but increased the excise duties and GST on the prices of petroleum and diesel leading to price rise which further took away money from the pocket of the common man making him poorer and transferring money from his pocket to the rich making them richer.