The Wealth Divide in India

A Game of Unequal Chances

India, the world's most populous democracy, is a nation of contrasts. While it boasts a booming tech industry, rapid urbanization, and an ever-growing economy, it also grapples with deep-rooted wealth inequality. The top 10% of Indians control over 80% of the nation’s wealth, while the bottom 50% share a meager 3%. This divide is not just a statistic—it affects the day-to-day lives, opportunities, and aspirations of millions. The metaphor of a "wealth game" is apt in describing how economic mobility is determined by where one starts, and the obstacles they face along the way.

The Lowest Tier: Struggling for Survival

At the very base of India’s economic pyramid are the people who earn just enough to get by. As per a report published by Centre for Monitoring Indian Economy (CMIE), stupendous 90 % of Indian workforces earns below ₹ 25,000 a month. For them, every single day is a new war to be fought because they have to find a way to feed themselves, pay the rent and get any medical care.

Food inflation and rising fuel prices add to thеir already difficult situations. Retail inflation was reported to be at 7.44% in July ’24 in India, many of the poorest households suffered the most , a phenomenon depressing those working poor. As prices of crops rose, the lower stratum of society worsened and had to forgo just about necessary things leading to famine and sickness.
Free food security coverage schemes have benefited many people, including beneficiaries of the Pradhan Mantri Garib Kalyan Anna Yojana for free grains, but such strategies are rarely enough to resolve functional problems of the poor. Economically, they are also prone to conflict since such characters are the first to be employed and the first to be released when there is job cut as most of them work in the informal sector with no contracts.
A report from the International Labour Organization (ILO) shows that almost 77 percent of Indian workers work in the informal economy. This status of their employment is what makes it hard for most of the workers to move up the economic ladder since they possess very little training, education, or financial resources to pull them out of this situation.

The Middle Class: Outlooks and Isolation

The middle class of India is at times disregard like the bedrock of the country’s economy. Indeed this class of society in India has its disadvantages. The Pew Research Center states that about 66 million Indians belong to the middle economic classification and earns somewhere between Rs75,000 to Rs150,000 a year.

Middle aged Indian people have adopted middle-class where they do better than the poorest households however this is insufficient enough to give security.The biggest problem is the upward mobility to higher levels of income, due to inflation that occurs in cities with a high population such as Bangalore and Mumbai. A typical home with middle-income has the capacity of having devices like smartphones, internet, even paying for domestic workers, but the aspect of insurance in financial gaps is something yet to be achieved.
Reserve Bank of India conducted this survey and throwing light on this vulnerability remarked: close to 80% of all Indian households that participated in the survey do not have enough savings if in the event their income is interrupted for more than three months. This group is also weighed down with family responsibilities such as providing for their aged parents or paying for their children’s education. It is due to this increase in property price that many in this segment have given up the dream of owning a house since it is impossible to save for it.
It is the middle-income class that finds itself in a mental war as well. Although they command better salaries compared to the lower class wage earners, they are still under constant urge to ‘move up’ and acquire assets such as houses, cars and investments. But because many industries have paralyzed wage progress and inflation continues to surge these aspirations are becoming hard to realize.

The Affluent Class: Financial Stability but New Fears

On the upper side of the income class where people earn more than rupees two lakh in a month, these people are few but very critical in the Indian society. Oxfam statistics indicate about 1% of the Indian population owns in excess of 40% of the wealth in the country. For such individuals the problem rather than that of scarcity is that of poor lifeS-cheer of wealth and the associated social class.
Executives and specialists working in technology or finance or real estate enjoy the finer things in life namely pay for health care of the highest standards, nutrition based on organic produce, travel whenever the need arises, and make ample investments. However, it does not mean they are free from stress. Given the high stakes involved particularly in stock markets and other volatile currencies such as cryptocurrencies, the individuals risk loosing their economic statuses in case there are unfavorable market conditions.

As with many developed countries, India’s rising hunger for more AI and technology focused industries has created a brand new pool of workers who are able to earn a lot of money. The increasing number of AI engineers and data scientists as well as professionals in fintech has contributed to wage inflation in these markets. However, job stability is still to be seen. The recent round of dismissals from big tech companies like Infosys or Wipro made high-income earners shiver — the notion that one can be comfortable financially is a myth.
Such individuals also tend to spend more money towards mental health and wellness knowing that even them are susceptible to the stress of always having to keep their status. In a study released for the year 2023 by Deloitte, it was noted that people were spending twenty percent more than they did 5 years ago on mental health services in urbanized India illustrating the increased stress among the Indian upper class.

The Elite: Parlaying with a Legacy Asset in Play

The rich in India’s wealth classification enforce the super rich occupiers who make their earning in a crores and manages an asset of hundreds of crores. As stated in the report by Wealth-X, there are over 7000 billionaires in Indian economy- each possessing not less than $30 million net worth. For this class of people, wealth is not just the accumulation of assets for the sake of ensuring survival; it is more of a heritage, and if anything, the power that one has.

In India, the ultra-rich own large amounts of the economy in relation to real estate, infrastructure, and the tech and manufacturing industries. Such wealth enables them to control not only the markets but even the politics. This class is also able to influence favorable policies such as tax incentives, and land deals to their advantage by making political contributions and lobbying.
Such issues particularly in relation to temptation and promise of many debates about reforms in the corporate taxation in India can be noticed with this group. While it is a good trend to give the businessmen and women tax holidays, slashing from 30% to 22% the corporate rate of tax in 2019, politicians rescue calls considered quite shocking, was taken as a step to promote big businesses. These people reform this society but by all means necessary, they serve the rich people hence most of the reform cannot tackle the already in constructed gap of inequality in the system.

India’s ultra-wealthy are also wary of losing their wealth and usually involve themselves in some estate planning strategies in order to preserve their wealth within families. Use of tax havens, investing abroad, and setting up of various kinds of trusts are some of the tools that are used to minimize the tax burden while ensuring that there are no significant loses in terms of inherited wealth.

India's reality concerning wealth mobility

The wealth mobility in India is still a dream for many despite government's attempts to solve the challenges of inequality through various programs and and economic reforms. However, as revealed by the World Inequality Database, the wealth inequality in India has always been worsening since the 1980s. An estimation of the prevalence acquired over 21% of the nation’s total income by the riches one percent.
It is true that government’s efforts towards advancement of initiatives such as Digital India, Startup India leads to the equalization of economic opportunities but in most cases, the results are skewed to the Schumpeterian city population at the expense of the vast rural and unskilled workers. Educational attainment still stands in the way. According to a study carried by UNESCO more than 17 million children sit on the sidelines of disrupted education in India which means that they grow up without the skill to earn money and thus remain tied up in poverty spirals.

To sum up, the ‘wealth game’ is more than just a metaphor, it is a lived experience that exposes the brutal aspects of life in an unequal society. Poor people are forced to work with minimum wages as there are ultra-rich people in India who wish to be a part of the legacy. In India the wealth is a derivative of several factors most of which are entrenched. While growth is beneficial to the nation, one of its greatest challenges is how to ensure that the growth is inclusive, the growth benefits all sections of society.