SBI Research report, individual income inequality in India has significantly declined in the past 8 years

Current Context: The State Bank of India (SBI) has released an economic research report revealing a substantial decrease in individual income inequality in India between the financial years 2013-2014 and 2021-2022 on 8th january 2024.

• The study attributes this reduction to a significant migration within the income categories at the lower end of the economic pyramid.
• The report states that income inequality, captured through the Gini coefficient of taxable income, has declined significantly from 0.472 to 0.402 during these financial years.
• According to the report, 36.3 percent of taxpayers have moved from lower income to higher income tax bucket, resulting in 21.3 percent additional income.
• The top 2.5 percent of taxpayer’s contribution in income has declined from 2.81 percent to 2.28 percent during the same period.
• Furthermore, the income disparity of people earning less than 3.5 lakh rupees has declined from 31.8 percent to 15.8 percent during the said period, signifying that the share of this income group in the total income, in comparison to their population, has increased by 16 percent.
• This is indeed a positive trend towards reducing income inequality in India.

Question:

Q.1 What is the main finding of the SBI’s economic research report?
a. Increase in individual income inequality in India
b. Decrease in individual income inequality in India
c. No change in individual income inequality in India
d. The report does not mention individual income inequality