Even after two decades of reform,Income inequalities rising in Bihar, J&K and M.P: Assocham

Income inequalities rising in Bihar, J&K and M.P: Assocham

Our Bureau

New Delhi, Jan. 16:

Even after two decades of reform, inequalities continue to rise in various States, broadly implying that the poor are getting poorer and the rich getting richer, says a recent study by the Associated Chambers of Commerce and Industry of India (Assocham).

The study confirmed that the growth rate of both average per capita expenditure and resultant demand rose during 2004-05 and 2009-10. “But while the average per capita consumption expenditure remained unchanged for the poorest 20 per cent people, the average household income of the richest 20 per cent increased by 7.7 per cent,” it said.

This broadly led to increased inequalities, the study added. On an average, a rural household in the richest 20 per cent category spent more than 258 per cent of what a household of similar size falling in the poorest 20 per cent category spent in 2004-05. This difference increased to 286 per cent in 2009-10.

“While the size of consumer markets expanded at a healthy rate of 7.9 per cent, economic inequality further widened over these five years.” the Assocham Secretary General, Mr D.S. Rawat, said.

The calculated Gini coefficients for States indicate that income inequalities increased in Jammu and Kashmir by 7.37 per cent, Madhya Pradesh, including Chattisgarh 4.96 per cent, and Bihar including Jharkhand by 4.9 per cent.

At the same time, gini coefficient values indicate falling inequalities in Orissa by 5.75 per cent, Maharashtra 3.85 per cent, Haryana 2.36 per cent and West Bengal. Rajasthan, Karnataka, North Eastern states and Union territories too have seen some fall in the degree of income inequalities.

Keywords: Income inequalities, Assocham,