Wealth divide in IndiaIndia is one of the most unequal countries in the world. The rich have been rapidly earning more money while the poor have been struggling to earn enough money to provide for themselves and have access to necessary services. The wealth divide in India has been continuing to expand, affecting women and children the most. The number of billionaires has doubled throughout the past 10 years. This increase has left the middle and lower class behind, harming them in order to profit the wealthy.

Inequality in Numbers

The wealthiest people in India have 77% of the national total amount of wealth. There are a total of 119 billionaires in India. In 2000, there were only nine. These billionaires have a fortune that would take the average worker 941 years to earn. In addition to this, their fortunes have increased by almost 10 times over the past 10 years. More than half of people in India are living in poverty, as about 780 million people live on under $3.10 each day. Almost 75% of people live in villages and earn their money through hard labor. Only 11% own a refrigerator and 35% cannot read and write.

COVID-19 and the Wealth Gap

COVID-19 has hurt India’s middle and lower-class significantly. Throughout the pandemic, billionaires have earned more money while the middle and lower classes have lost money due to the decrease in economic activity and lockdown restrictions. One of the world’s richest men, Mukesh Ambani, earned $30.5 billion in wealth. In addition, Cyrus Poonawala, the founder of Serum Institute of India, added $5.56 billion to his net worth in 2020.

Due to the strict lockdown, which started on March 25, 2020, in India, millions of workers across the country lost their jobs and, as a result, had no source of income. This pushed even more people into poverty, further widening the wealth divide in India. This was also true of middle-class people, as they faced many job losses and pay cuts, resulting in a decrease in income.

CMIE reported that there was a 26% fall in industrial workers since the start of the pandemic. This consisted of small industrial units and enterprises. It also reported that there was a loss in white-collared employees, such as engineers, physicians and teachers. This was the biggest loss among salaried workers. Many also view healthcare as a luxury in India. Only those who have the money to pay for healthcare can obtain decent care in India. As a result, the poorest areas in India have high infant mortality rates and maternal deaths.

Possibilities for Change

People are more likely to succeed if they get a quality education. In Asian countries, rich people are more likely to have had four full years of school than the poor population. As a result, the growing inequality connects a lack of education with a lack of a substantial salary. The divide between the wealthy and the poor requires introducing policies in order to stop inequality and social injustice. Few governments have implemented these kinds of policies. If the government focused more attention on the wealth divide in India, it may be able to put more policies into place.

– Miranda Kargol
Photo: Flickr

Internet Access in IndiaGrowing internet access has the potential to transform the lives of India’s 270 million poor people. A country of almost 1.4 billion, India has seen tremendous technological and economic growth over the past 20 years. Until recently, the lack of pervasive and affordable mobile coverage served to limit internet access in India. Most regions still relied on 2G technology and only 9% of rural Indians had reliable mobile internet access as recently as 2015. Jio Platforms, launched in 2016 by Reliance Industries, was the country’s first nationwide 4G network. It is a disruptive telecommunications company that facilitates innovation in India by expanding internet access in an affordable way.

High Speed, Affordable Internet

Jio was launched in 2015 by Indian billionaire, Mukesh Ambani, as a part of his $125 billion company, Reliance Industries. With deep sources of funding, Jio could afford to invest over $22.5 billion. This would go toward an ambitious plan to build a nationwide 4G mobile. Unlike 2G and 3G, 4G technology handles both data and voice in the same, data-efficient way and offers cheaper and faster speeds. This has made 4G technology the backbone of the modern internet. It enables the speed and instant connectivity required for tasks like streaming videos or online banking.

After it launched, Jio gained customers by giving them access to its 4G network entirely for free in 2016. It has since introduced rates that start as low as $1 a month and scale to offer gigabytes of data for just a few dollars. Along with the mobile network, Jio has built an online ecosystem and sells its own 4G smartphone. Customers can acquire smartphones for as little as a $20 deposit. Jio’s low prices have been a complete gamechanger for the hundreds of millions of Indians who previously couldn’t afford an expensive data plan.

Over the past four years, Jio has gained almost 400 million subscribers and became the largest mobile network on the planet. With the tremendous scale and 4G infrastructure, Jio has been able to make money while upending the Indian mobile market. Competitors have been forced to cut prices to compete, leading to a 35% drop in revenue in the industry over the past two years despite an expanding market.

What it All Means for India

Jio has fundamentally transformed what internet access in India looks like for hundreds of millions of people. Access to the internet in rural areas has tripled since 2015 and is growing at a rate of 35% a year. As a result of Jio’s prices and 4G infrastructure, analysts estimate that the average internet user has gone from using 700MB of data a month to 11GB. This means that more people are accessing sites such as YouTube, for which India is currently the fastest-growing market.

Currently, 80% of poor people in India live in rural areas. Rapid growth in internet access stands to shorten the opportunity gap between urban and rural areas. In recent years, there has been a boom in tech companies innovating in e-commerce. They have also been innovating in financial services and entertainment among other things. For many people in rural areas, access to the internet also means access to services that can improve their quality of life. These services include online education programs.

Just the Beginning

For all of Jio’s success, 627 million people in India are internet users. It is expected that millions more will be online over the next few years. Google, Facebook and other American tech companies have announced over $20 billion in investments with Jio so far in 2020. By all accounts, the internet transformation unleashed by Jio is just beginning. Internet access in India will continue to expand at a very high rate over the years to come.

Jack McMahon
Photo: Flickr

Last Sunday, February 10th, Mukesh Ambani, the richest man in India and second richest in Asia, interviewed with Fareed Zakaria in the first television interview he’d given in almost a decade. Ambani is Chairman and CEO of India’s largest company, Reliance Industries, which focuses on petrochemicals, refining, and oil & gas. In the interview, he comments on his views regarding the state of the global economy.

Ambani is optimistic that an economic recovery is set to emerge in the US, citing increasing independence from foreign imports of energy which he predicts will come in “the next five or seven years.” The cause of this recovery is a fundamental transformation in the energy scene taking place in the US. The shift to “non-conventional energy in shale oil and gas,” he says, is not just of great benefit to the US, but across the world as well.

Regarding the economic growth in India, Ambani is “bullish,” commenting that economic growth in India is “the aspirations of a billion people. And ours is a country where all the billion count.” He calls it a “bottom-up story,” noting that the country will adjust with how the rest of the international community performs but that India is on a “long-term growth trajectory.”

When questioned on the problem of inequality in India, Ambani stated that it was a problem not specific to India but present all across the world. He went on to say that businesses have an obligation to alleviate this inequality by investing in ordinary Indians. Reliance, he says, has created wealth for India through the opportunities that were provided to them by their country. This, he says, is “the process of creating wealth.”

“Income comes from opportunity… Once you create opportunity, wealth comes.”

– Rafael Panlilio

Source: CNN