India rises to 4th globally in income equality, ahead of US and China: World Bank

India has quietly emerged as one of the most income-equal countries in the world, according to the World Bank’s Spring 2025 Poverty and Equity Brief. With a Gini Index of 25.5, India ranks fourth globally in income equality, behind only the Slovak Republic (24.1), Slovenia (24.3), and Belarus (24.4). The Gini Index positions India ahead of the United States (41.8), China (35.7), and all G7 and G20 countries. This shift marks a significant change in India’s economic narrative, which has historically been associated with high levels of inequality.

What is a Gini Index?

The Gini Index is a global standard used to measure income inequality within a country. Ranging from 0 (perfect equality) to 100 (complete inequality), a lower score indicates a more balanced income distribution. With a Gini score of 25.5, India falls into the 'moderately low' inequality bracket (25–30).

Decline in Poverty and Improved Distribution

India’s current score marks a notable improvement from 28.8 in 2011. The World Bank reports that, between 2011 and 2023, India lifted 171 million people out of extreme poverty. The poverty rate, which stood at 16.2 per cent in 2011, has now dropped to just 2.3 percent based on the international poverty line of $2.15 per day. During this period, India’s Gini Index improved from 28.8 to 25.5, reflecting more equitable income distribution. The World Bank attributes this progress to focused policy interventions aimed at poverty reduction and ensuring benefits reach the lowest-income households.

The country’s economic gains are increasingly being shared more evenly, a notable contrast to widening inequality trends in several developed nations. The World Bank data suggests that India’s model, which is emphasising more on targeted delivery, financial access, and digital identification, has played a key role in fostering inclusive growth.

Role of Welfare and Digital Governance

The release also highlights on key government schemes playing important role in this transformation. The Pradhan Mantri Jan Dhan Yojana, Aadhaar, Direct Benefit Transfers (DBT), PM Vishwakarma Yojana and, Ayushman Bharat yojana. The Stand-Up India initiative and PM Vishwakarma Yojana have supported entrepreneurship among marginalised groups. Meanwhile, food security under the PM Garib Kalyan Anna Yojana has benefited people nationwide.