India’s billionaires saw their wealth grow by ₹22 billion every day last year while the poorest 50% only saw a 3% rise in income: Oxfam

• Last year, the richest 1% collectively increased their wealth by around 39%, according to a report by Oxfam.
  
• As a result, the richest now account for 51.5% of India’s total wealth while the bottom 60% own less than 5%.
  
• While the financial divide in India is attributed to a number of reasons, the Oxfam report singled out one important factor: tax breaks for the rich.
  

India’s widening wealth gap is showing no signs of slowing down.

Last year, the richest 1% collectively increased their wealth by around 39%, according to a report by Oxfam, a poverty alleviation organisation. As a result, the richest now account for 51.5% of India’s total wealth while the bottom 60% own less than 5%.

In fact, India’s billionaires - the number of which grew from 101 to 119 - saw their wealth grow by ₹22 billion every day last year, as per data sourced from Credit Suisse and the Forbes’ Rich List. For the sake of comparison, this daily addition of wealth to the bank accounts of the country’s richest was equivalent to the amount of funds that cash-strapped national airline Air India required in June 2018 to meet its working capital obligations.

In its annual report, entitled “Public Good or Private Wealth,” Oxfam found that the bottom 50% of Indians, in terms of income, only saw a 3% rise in their wealth. To make matters worse, the poorest 10% of India still remained in debt, a state they’ve been in for the past 15 years.

As a result, the nine wealthiest Indians, led by Mukesh Ambani, the owner of Reliance Industries, collectively own as much wealth as the bottom half of India’s population, something that Winnie Byanyima, the international executive director, termed as “morally outrageous.”

While the financial divide in India is attributed to a number of reasons, the Oxfam report singled out one important factor: tax breaks for the rich.

The report found that wealthy Indians were paying close to one-eighth of what they should have been surrendering in taxes, thanks to a litany of exemptions and evasion measures.

In addition, rising healthcare costs and inadequate funding for public services like education also impacted India’s poor. A report by the Public Health Foundation of India in June 2018 found that the rising cost of medicines had pushed nearly 38 million Indian families below the poverty line between 1994 and 2014.

And the situation will only get worse from here on in, according to Oxfam. Around 70 new millionaires are expected to be created every day between 2018 and 2022.

On paper, the solution proffered by Oxfam seemed easy. A mere 0.5% increase in taxes on India’s richest would be enough to cover a 50% increase in the government’s healthcare expenditure. Additional recommendations included the improved implementation of Right to Education norms and budgeting with an emphasis on females.

On a global level, the picture is even more dire. The world’s billionaires, the number of which has doubled since the financial crisis of 2008-09, pocketed $2.5 billion a day in 2018, capping a 12% rise in their wealth over the course of the year. Meanwhile, the bottom 50% of the global population - around 3.8 billion people- actually experienced a 11% decline in their wealth.

Hence, as compared to 43 people in 2017, by the end of 2018, just 26 people, led by Amazon CEO Jeff Bezos, owned as much wealth as 3.8 billion other people.


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