Individual income inequality down from 0.47 to 0.40 during FY14-FY22: SBI

Decline in income inequality: The Gini coefficient estimated using ITR data of taxable income of individuals shows that individual income inequality has significantly declined from 0.472 to 0.402 during FY14-FY22, the SBI said in its post-budget analysis report. “We have now also estimated the decline in income inequality of casual workers from Periodic Labor Force Survey (PLFS) data to understand the movements in income decline at the bottom of the pyramid,” the report stated. 

According to the report, It is estimated that inequality has also declined for casual workers (rural, male) from 0.482 in FY20 to 0.426 in FY23. 

Gini Coefficient

The report debunks the fact that the rural economy is under great distress and adds that the sharp fall in the Gini coefficient for rural casual workers as per our study reinforces the tangible proofs of the rising propensity of prosperity across the hinterland, dissipating inequality as also poverty, a sharp blow to cacophony from select quarters who, on purpose, choose to distort the picture with jaundiced views. “Additionally, as per our earlier estimates, we believe that by the end of the next decade, ~50 per cent of consumption / Rs 16 trillion would be done by 90 per cent of the people who are at the bottom of the pyramid,” the SBI report highlighted. 

According to SBI, an additional Rs 8.2 trillion of consumption has moved to the lower end of the pyramid post-pandemic following savings of expenditure through free food, shelter and medical being provided by the Government.