India has emerged as the world’s fourth most equal society, with a Gini Index of 25.5, outpacing all G7 and G20 nations, according to the World Bank.
About Gini Index:
The Gini index, also called the Gini coefficient or Gini ratio, determines a nation's level of income inequality by measuring the income distribution or wealth distribution across its population.
The Gini index was developed in 1912 by Italian statistician Corrado Gini.
The coefficient of the Gini index ranges from 0 (or 0%) to 1 (or 100%), with 0 representing perfect equality and 1 representing perfect inequality.
To offer two hypothetical examples, if a nation were to have absolute income equality, with every person earning the same amount, its Gini score would be 0 (0%).
On the other hand, if one person earned all the income in a nation and the rest earned zero, the Gini coefficient would be 1 (100%).
Mathematically, the Gini coefficient is defined based on the Lorenz curve.
The Lorenz curve plots the percentiles of the population on the graph’s horizontal axisaccording to income or wealth, whichever is being measured.
The cumulative income or wealth of the population is plotted on the vertical axis.
The Gini index is not an absolute measure of a country’s income or wealth. The coefficient only measures the dispersion of income or wealth within a population.
India’s Gini Index:
According to the recent World Bank report, India’s Gini Index stands at 5, placing it as the fourth most equal country globally,behind only the Slovak Republic, Slovenia, and Belarus.
This performance not only surpasses regional peers like China, which holds a Gini score of 35.7, but also positions India ahead of every G7 and G20 nation in terms of income equality.
It marks a steady improvement from a Gini score of 8 in 2011 to 25.5 in 2022, signalling meaningful gains in bridging income gaps over the past decade.
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