Within the months following the outbreak of the COVID-19 pandemic, considerations have been being raised about deepening inequalities in India, with some calling it as a ‘Ok-shaped’ restoration, the place wealthy emerged richer whereas the poor slipped down additional.
Based mostly on knowledge and research, the SBI economists mentioned, “… in hindsight, the pandemic could have been a leveller by way of inequality with the poor getting protected by measures equivalent to meals transfers.”
It mentioned India has delivered a pointy restoration after the pandemic and acknowledged that critics are nonetheless quoting it as a Ok-shaped restoration for India.
“… It’s true that the sturdy rise in monetary property resulted in a rise in inequality in 2021. Nonetheless, when correlated with short-run asset value actions, such fluctuations in inequality at all times show transient,” the report mentioned.
“… Within the Indian context, it’s an incorrect conjecture to imagine that inequality has worsened throughout the pandemic,” it added, citing its research on how cereal procurement has helped cut back inequality.
The report mentioned a better procurement is benefitting the poorest of the poor by way of subsequent free distribution of foodgrains, and in addition serving to put cash within the arms of smaller and marginal farmers, with distributional influence.
“With a progressive progress in output throughout states as proxied by GSDP, it’s clear that the fruits of such a progress have clearly reverberated and dovetailed into an inclusive progress.
“India has thus achieved fairly effectively throughout pandemic by way of navigating earnings shocks throughout deciles of inhabitants,” the research mentioned.
