World Inequality Report ‘flawed’, methodology ‘questionable’: Sitharaman

Union finance minister Nirmala Sitharaman on Tuesday termed the World Inequality Report ‘flawed’ and called its methodology ‘questionable’. The comments came in response to the World Inequality Report 2022, published by the Paris-based World Inequality Lab, which said India is a ‘poor and very unequal country’ and ranked it in the bottom half of the list in terms of both income and wealth.

“World Inequality Report terming India as ‘poor and very unequal country’ is flawed, based on questionable methodology,” Sitharaman said during a Rajya Sabha session.

The report, released on December 7 last year, showed that while the bottom half of India’s population earned ₹53,610 on an average, the top 10 per cent earned 20 times higher, roughly ₹11,66,520.

It also showed that the richest 10 per cent of the country owned 76 per cent of the total wealth, holding 57 per cent of the national income in 2021, while the share of the bottom 50 per cent went down to 13 per cent.

The top one per cent held more than one-fifth of the total national income.

The World Inequality Report 2022 also estimated gender inequality in global earnings, showing that women in India received only 18.3% of the labour income in 2020. This is almost half the share that accrued to women in other developing economies such as Brazil (38.5%) and China (33.4%), as well as the global average (34.70%).

These, adding to other contributing factors, led to India’s positioning in the report as a ‘poor’ and ‘very unequal’ country, with an affluent elite population.