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According to the World Bank, India ranks 4th globally in consumption‑based Gini index (25.5), with extreme poverty down from 16.2% to 2.3% (2011–23), driven by welfare schemes.

What does "income equality" mean?

Income equality means that the money people earn in a country, or their "income," is distributed more fairly among everyone, rather than a few people having most of the wealth and many people having very little.

Experts use the Gini Index to measure how evenly income is spread out. The Gini Index gives a score from 0 to 100.

• A score of 0 means "perfect equality" – everyone earns exactly the same amount. (This is almost impossible in real life).
• A score of 100 means "perfect inequality" – one person earns all the money, and everyone else earns nothing. (This is also very rare).
• India's Gini Index score in 2022-23 was 25.5. This score puts India in the "moderately low inequality" group, meaning income is distributed much more evenly than in many other places.

The World Bank report says India is now the fourth most income-equal country globally, with only a few smaller European nations like the Slovak Republic, Slovenia, and Belarus having slightly better scores.

What is "extreme poverty"?

Extreme poverty means people live on little money. The amount is barely enough to cover basic needs like food and shelter.

In 2011-12, about 16.2% of Indians lived in extreme poverty. By 2022-23, this number dropped dramatically to just 2.3%. Over 17.1 crore Indians escaped extreme poverty in just over a decade.

How did India achieve the progress in equality and poverty reduction?

Boosting Financial Inclusion

PM Jan Dhan Yojana => Helped over 55 crore people, especially those in villages and those who didn't have bank accounts before, to open their first bank accounts. This gives people a safe place to keep money and access financial services.

Aadhaar-linked Direct Benefit Transfers (DBT) => Government linked people's bank accounts to their Aadhaar, which allowed the government to directly send money for benefits (like subsidies for cooking gas or scholarships) to people's bank accounts. This stopped corruption and ensured the money reached the right people.

Improving Health and Social Security

Ayushman Bharat => Health insurance scheme offers ₹5 lakh in health insurance to poor families, covering serious medical expenses. Over 40 crore people now have these health cards.

PMGKAY (Pradhan Mantri Garib Kalyan Anna Yojana) => Provide free food grains to over 80 crore people, to ensure food security and nutrition for the most vulnerable.

Supporting Livelihoods and Entrepreneurship

Stand-Up India => Offers loans and financial help to people from Scheduled Castes (SC), Scheduled Tribes (ST), and women, to encourage them to start their own businesses.

PM Vishwakarma Yojana => Helps traditional artisans (like potters, weavers, carpenters) by giving them training, easy access to credit, and market support, helping them earn a better living.

How is India's approach unique?

India's success stands out among 167 surveyed countries because it didn't just depend on standard economic growth.

India's journey is special because it has achieved a rare balance: it has grown its economy while also making society fairer for everyone.

While other countries with low inequality, like Norway or Finland, depend on long-standing welfare systems (where the government provides many services and benefits), India has achieved its success through unique methods.

India has used digital inclusion (getting everyone online and connected), targeted cash transfers (sending money directly to those who need it), and integrated rural support.

This makes India a distinct model for large, diverse democracies that aim to grow their economy while ensuring fairness for all their citizens.  

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Source: 

TIMESOFINDIA