Cong slams govt over rising 'inequality', cites World Bank poverty report

Congress leader Jairam Ramesh alleged that while the Modi government is presenting the World Bank report as a success story, it raises serious concerns about persistent inequality

The Congress on Sunday accused the Centre of embedding "sharpening inequality" into the country's economic growth, citing a recent World Bank report. It called for urgent tax reforms in GST, an end to "brazen corporate favouritism", and income support for families to address the widening wealth gap.

 

In a statement released on X, Congress general secretary in-charge of communications Jairam Ramesh pointed to the World Bank’s 'Poverty and Equity Brief for India' released this month. He alleged that while the Modi government is presenting it as a success story, the report raises serious concerns about persistent inequality.

 

What does the World Bank report say?

 

The World Bank’s 'Poverty and Equity Brief for India' reports a sharp decline in rural and urban extreme poverty. Rural extreme poverty fell from 18.4 per cent to 2.8 per cent, while urban extreme poverty declined from 10.7 per cent to 1.1 per cent, narrowing the rural-urban gap from 7.7 to 1.7 percentage points. Using the $3.65 per day benchmark for lower-middle-income countries, poverty in India dropped from 61.8 per cent to 28.1 per cent between 2011-12 and 2022-23, lifting 378 million people out of poverty.

 

 

However, Ramesh attributed this progress to the long-standing effects of economic liberalisation and social welfare programmes implemented during the UPA governments between 2004-14, particularly MGNREGA and the National Food Security Act (NFSA).

 

Congress flags data quality and rising poverty rates

  The Congress leader highlighted that the World Bank also cautioned that updated data using the 2021 purchasing power parity conversion factor could show a higher poverty rate. He alleged the report's concerns over changes in survey methods compromised data comparability over time — a move he linked to the NDA government's rejection of the 2017-18 Household Consumption Expenditure Survey.

 

Ramesh further argued that applying the $3.65 a day poverty line for lower-middle-income countries, the appropriate benchmark for India, reveals a significantly higher poverty rate of 28.1 per cent in 2022. He cited wage disparity figures showing that the top 10 per cent earn 13 times more than the bottom 10 per cent and alleged that official data may underestimate consumption inequality.

 

Congress demands strengthening of welfare measures

  The Congress leader said the report underlined the urgent need to strengthen social welfare measures like MGNREGA and the NFSA to protect vulnerable populations. He reiterated the Congress's demands to raise MGNREGA wages, conduct the overdue Population Census, and expand the NFSA’s coverage by 10 crore people.

 

Criticising the Modi government’s record on data transparency, Ramesh accused it of manipulating economic data when inconvenient truths emerge. He demanded that the government update the official poverty line, citing the Rangarajan Committee Report submitted in 2014 as the last such exercise.

 

"There is a compelling need for tax reforms to correct GST’s regressive effects, to end tax terrorism, stimulate corporate investment, curb corporate favouritism, and provide income support and savings incentives for households," Ramesh said.