Income inequality in India | Causes of Income Inequality in India

5/5 - (1 vote)

Hi friends, in today’s article we are going to know about Income inequality in India and also know the causes of Income Inequality in India. So let’s discuss in details.

Income inequality in India

Income inequalities in India is defined as the in equal distinction of income and wealth between different section of people in a society. In other words, the gap between rich and poor people in India regarding their distinction aspect is known as income inequalities.

The problem of inequality in the distinction of income and wealth has gained much important in India. It should be noted that such distinction in India has under gone a rapid change during 70’s and 80’s.

Causes of Income Inequality in India

Various factors or causes are responsible for the unjustifiable income distinction in the country. Some of the important inequality generating factors can be stated as follows –

Right of private ownership of Property – Income inequalities problem in India has arrised due to the important cause of to enjoy a right of private ownership on poverty. Generally as a result of privately owned tangible wealth like land, buildings, automobiles etc. will play a significant role for accelerating the problem of income inequalities in India.

Private ownership of Industries – India is maintaining the system of private ownership of industries from the very beginning. This has led to a huge concentration and control of assets in the hands few number of people which are wanted to play a monopoly role. Consequently, income inequalities has arrised.

Dis-similar Treatments – Inequalities in income has arrised in India due to dis-similar treatments among people regarding their knowledge, training etc. children belonging to higher society have accessibility to higher education which can play a major role for increasing the problem of income inequalities.

The low of Inheritance – The prevalence of the law of inheritance in India creates a huge gape of income and wealth between rich and poor. It is because, according to this low the property of owner is inherited by his sons and daughters which makes rich become richer.

Increasing trend of Unempt – In India the problem of unempt has accelerated the problem of income inequalities both in urban and rural areas of the country. It can be stated that till new duet to higher level of unempt specially disguised and seasonal unempt has resulted in making poverty more dangerous.

Faulty tan System – The tan system in India is though progressive in nature, it fails to reduce the extent of income inequalities. The govt. has fail to check the tendencies of tax evasion which increases the gap between rich and poor section of people in the society.

Ineffective credit Policy – The credit policies of all the financial institution are not much effective. The financial institutions provided various facilities by big houses by neglecting the small houses as well as unorganized sector of the economy. Consequently, rich become richer and poor become poorer.

Continuous rise in Prices – One of the important factor of increasing income inequalities is regarded as the continuous rise in prices of goods and services. Specially from the year 1955. It has resulted automatic increase in value of asset own by richer sections of people. Consequently, income inequalities have arrived.

Ineffective licensing Policy – The licensing policy of the govt. is discriminatory in nature. The Indian govt. has tried to make protection only to the big industrialist. Thus, govt. has failed to protect the interest of small scale industries.


So friends, this was the concept of Income inequality in India. Hope you get the full details about it and hope you like this article.

If you like this article, share it with your friends and turn on the website Bell icon, so don’t miss any articles in the near future. Because we are bringing you such helpful articles every day.  If you have any doubt about this article, you can comment us. Thank You!

Read More Article

Types of Unemployment in India | What is Unemployment?

Non Bank Financial Intermediaries | Bank and Non bank financial intermediaries

Spread the love:

Hi, this is Eusub Ali Khan, Author & Owner of I am a Content Writer, blogger and professional web-designer. I love to share my educational knowledge with people.

Leave a Comment

error: Content is protected !!