5 min readNew DelhiMay 21, 2022 04:42 AM IST
First published on: May 21, 2022 at 04:42 AM IST
The report released by the Economic Advisory Council to the Prime Minister (EAC-PM) on the state of inequality of India caught senior government officials in Niti Bhavan by surprise, a number of whom were unaware that the advisory body had commissioned such a report or that the findings had been released Wednesday. The report recommended that the government launch a guaranteed employment programme for the urban unemployed and roll out a universal basic income (UBI) scheme to reduce income gaps, among other things.
While the report, titled ‘The State of Inequality in India’ was released by EAC-PM’s Chairperson Bibek Debroy on Wednesday, sources said senior officials who work closely with the government’s policy advisory body had not received a copy until late after its launch. “I learnt that there was a report like this through a media article,” said an official who works closely with the EAC-PM, on condition of anonymity. Niti Bhavan in central Delhi houses the EAC-PM. Officials who work closely with the EAC-PM also distanced themselves and the advisory body from the report and its contents, which was prepared by the Gurgaon-based Institute for Competitiveness (IFC). “This is not the EAC-PM’s report, but just submitted to them. EAC-PM does not necessarily endorse the recommendations made in the report,” said an official. The report may not be officially presented to the upper ranks of the Central government, it is learnt.
While sources close to the EAC-PM, including those involved in the formulation of the report, reiterated that the report was an “independent” task with no involvement or agenda setting by the EAC-PM, senior government officials questioned why the report carried the official logo of the EAC-PM on its cover and that its release by Debroy was communicated by a Press Information Bureau (PIB) release, which is typically used for official government-related updates. “We were surprised that the report had EAC-PM’s logo and that its release was done through PIB,” said a senior government official.
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Queries sent to Debroy remained unanswered until publication. Queries sent to the Finance Ministry on the issue did not elicit a response.
IFC provides advisory services to corporates and governments, and is the Indian chapter of the global network of the Institute for Strategy and Competitiveness at Harvard Business School. It has previously worked closely with the Niti Aayog in preparing the government think tank’s recent export preparedness index, the second edition of which was released in March 2022, and India innovation index, which was last released in 2021. These indices were launched by Niti Aayog chief Amitabh Kant and the think tank endorsed them. IFC is headed by Amit Kapoor, who, as per his website, sits on the board of competitiveness initiatives in Mexico, the Netherlands, Italy and France.
The timing of the report and some of its recommendations are also crucial — for instance, one of its key recommendations calls for introducing UBI. This is not a novel idea, and a similar policy was, in fact, a key part of the Indian National Congress’ campaign in the run up to the 2019 Lok Sabha elections. In its manifesto, the party had promised Rs 72,000 per year to the poorest 20 per cent of India’s households, which the then Congress president Rahul Gandhi had called a “final assault” on poverty. Even before that, the idea was endorsed by former Chief Economic Advisor Arvind Subramanian in the Economic Survey for FY17 in place of subsidy transfer, which the then Finance Minister Arun Jaitley had said might not be politically feasible in India despite being supportive of it.
While launching the report on Wednesday, Debroy also said it was difficult to gauge income inequality in India, owing to the lack of comprehensive data, adding “what we do have and what we should have is data on distribution of consumption expenditure”. “Unfortunately, it’s the case that the last comprehensive NSS data on consumption and expenditure is for 2011-12. And we have had nothing after that,” Debroy had said.
Incidentally, in 2019, the Ministry of Statistics and Programme Implementation had decided not to release the results of the all-India Household Consumer Expenditure Survey (CES) conducted by the National Statistical Office (NSO) during 2017-2018, citing “data quality issues”, for which it was severely criticised. A media report at the time released leaked findings from the 2017-18 which showed that inflation-adjusted average monthly per capita expenditure (MPCE) declined by 3.7 per cent in India between 2011-12 and 2017-18, which was a first in four decades. The decline was led by an 8.8 per cent decline in rural MPCE.
EAC-PM’s Chairperson Bibek Debroy 
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