India has emerged as one of the most economically equal societies in the world, ranking fourth globally in income equality, according to the World Bank’s latest data. The country’s Gini Index now stands at 25.5 — a significant improvement from 28.8 in 2011 — placing it ahead of all G7 and G20 nations, including the United States (41.8), China (35.7), Germany (31.4), and the United Kingdom (34.4).
The Gini Index is a widely used metric to gauge income inequality on a scale from 0 (perfect equality) to 100 (extreme inequality). Only the Slovak Republic, Slovenia, and Belarus now rank ahead of India, reinforcing the country’s emergence as a rare example of high economic growth paired with improving income equity.
This recognition comes at a time when India has also been officially confirmed as the world’s fourth-largest economy in nominal terms, overtaking Japan and trailing only the United States, China, and Germany. According to the International Monetary Fund (IMF), India’s GDP is projected to grow by 6.8 per cent in 2025 — among the fastest in the G20 — supported by robust domestic demand, government-led infrastructure investment, and a dynamic services sector.
The World Bank’s Spring 2025 Poverty and Equity Brief notes that India has lifted 171 million people out of extreme poverty between 2011 and 2023. Based on the $2.15 per day global poverty threshold, the poverty rate has declined sharply from 16.2 per cent in 2011 to just 2.3 per cent in 2023, underscoring the depth and scale of India’s inclusive development.
Experts attribute this transformation to a range of structural reforms and targeted welfare schemes that have expanded financial access, improved social safety nets, and enhanced public service delivery.
“India’s success in narrowing inequality and reducing poverty reflects a deliberate and sustained policy focus. The country has effectively deployed digital infrastructure and direct transfers to ensure benefits reach those most in need,” the World Bank said in its commentary.
The expansion of financial inclusion through the Pradhan Mantri Jan Dhan Yojana has been a cornerstone of this achievement. Since its launch in 2014, the scheme has opened over 550 million bank accounts, bringing millions of unbanked individuals into the formal financial system. Linked with Aadhaar — the world’s largest digital ID platform covering over 1.42 billion people — and mobile connectivity, the system has enabled seamless delivery of welfare payments via Direct Benefit Transfers (DBTs). As of March 2023, DBTs had saved the government over Rs3.48 trillion by eliminating leakages and duplication.
Social protection has also been significantly enhanced through Ayushman Bharat, India’s universal health insurance scheme offering Rs500,000 in coverage per family annually. With over 410 million health cards issued, it represents one of the world’s largest publicly funded health programs.
Other key drivers of India’s equity-focused development include PM Garib Kalyan Anna Yojana (PMGKAY) — a food security scheme benefiting over 80 crore citizens, especially during the Covid-19 pandemic — and initiatives such as Stand-Up India and PM Vishwakarma Yojana, which support marginalized entrepreneurs, artisans, and craft workers through credit, training, and formal recognition.
Economists believe that India’s combination of high growth and social equity offers an important model for other developing economies. “India’s case shows that it’s possible to achieve rapid economic expansion while reducing inequality — provided there’s strong policy coordination, technological innovation, and inclusive governance,” said Dr. Raghuram Rajan, former RBI Governor, in a recent interview.
The IMF has echoed this optimism in its latest World Economic Outlook, praising India’s stable macroeconomic environment and structural resilience. The report forecasts that India will contribute more than 16 per cent of global growth in 2025, second only to China, and that its share of global GDP (in purchasing power parity terms) will continue to rise steadily.
While challenges remain — including regional disparities, unemployment, and the need for greater investment in education and healthcare — India’s progress is increasingly being recognised as both statistically impressive and socially significant.
As the world’s most populous nation and a rising global economic power, India’s ability to combine growth with equity could play a defining role in shaping the global development narrative over the coming decade.
issacjohn@khaleejtimes.com