India's Finance Minister Nirmala Sitharaman has announced that the gap in asset ownership between the rich and poor is narrowing, highlighting the country's robust economic growth. Speaking at a recent economic forum, Sitharaman emphasized India's position as the world's fastest-growing major economy, attributing this growth to various government policies aimed at inclusive development.
Several factors contribute to this shift. Increased government spending on key sectors like infrastructure and social programs is playing a crucial role. The Finance Minister also addressed concerns about state debts, emphasizing fiscal discipline. Supplementary demands for grants were approved, including increased spending on fertilizers and oil subsidies. These investments are designed to create opportunities and uplift marginalized communities, fostering greater economic participation and asset accumulation.
Furthermore, government initiatives promoting financial inclusion, such as expanding access to banking services and encouraging investment in formal financial instruments, are empowering individuals from lower-income groups to build wealth. The expansion of digital payment systems has also facilitated easier and more transparent financial transactions, particularly in rural areas, enabling more people to save and invest.
However, challenges remain. While the asset ownership gap may be narrowing, wealth inequality is still a significant concern. According to the World Inequality Report 2026, the top 10% of earners in India control a substantial portion of the national income and wealth, while the bottom 50% possess a considerably smaller share. The report highlights that the richest 10% account for 65% of the wealth, with the top 1% capturing 40% of it. The bottom 50% account for just six per cent of the wealth.
Critics also point to the regressive nature of India's tax system, which relies heavily on indirect taxes like GST. These taxes burden poorer households more than wealthy ones, potentially hindering their ability to save and invest. Additionally, the lack of an inheritance tax allows for unchecked inter-generational wealth transfer, further exacerbating inequality.
To accelerate the narrowing of the asset ownership gap, experts suggest several measures. These include implementing more progressive tax policies, promoting gender-sensitive reforms to increase female labor participation and earnings, and strengthening social safety nets to protect vulnerable populations. The Modi government could have gone for gender-sensitive reforms by narrowing wage gaps, enforcing equal pay, stronger protection against discrimination, childcare support, safe transport and flexible hours to expand household incomes and reduce income inequality.
Looking ahead, continued focus on inclusive growth policies, coupled with targeted interventions to address wealth inequality, will be crucial in ensuring that the benefits of India's economic progress are shared more equitably across society. The government's commitment to fiscal discipline and strategic asset management, as demonstrated by the Strategic Asset Review and Balance Sheet Framework, will also play a vital role in achieving sustainable and inclusive growth.
