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Extreme reluctance in India to part with income data: Thomas Piketty

Access to income tax data is critical in measuring inequality and understanding the distribution of wealth. India used to publish the All India Income Tax Statistics until 2000, when it was discontinued.

Thomas Piketty delivers a lecture at Jawaharlal Nehru University in Delhi on Thursday. (Express Photo by: Tashi Tobgyal) Thomas Piketty delivers a lecture at Jawaharlal Nehru University in Delhi on Thursday. (Express Photo by: Tashi Tobgyal)

For someone widely recognised for his work on income distribution and whose recent bestseller pushed inequality to the forefront of public debate, the brick-tiled precincts of the the traditionally Left-leaning Jawaharlal Nehru University’s convention centre offered an almost apt setting for a winter-morning discourse by Thomas Piketty.

The French economist’s hour-long speech to an auditorium packed with academics, students, bureaucrats and diplomats on the widening inequality of wealth across nations had two takeaways for India — a sharp critique on the country’s reluctance to part with income data and a push for the need to move, in the long run, towards reservations based on parental income and wealth.

Piketty started off his address to the nearly 1,500 in the audience by apologising for the fact that India does not have a bigger part in his latest book — Capital in the Twenty-First Century — something that he attributed almost solely to the “lack of adequate historical data”.

“There is extreme lack of transparency for data, especially income tax data, in India,” Piketty said. “It is very difficult to get data from authorities and there has been a decline in publication of income tax data. I don’t understand why there is no pressure from the media and universities on the government to make such data public,” he said.

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Access to income tax data is critical in measuring inequality and understanding the distribution of wealth. India used to publish the All India Income Tax Statistics until 2000, when it was discontinued. “Every time, I ask about when access to data could become possible, I am told this will change in a week or two, or in a month. But it never happens,” Piketty, a faculty at the Paris School of Economics, said, even as he apologised for his strong French-accented English.

India has one of the worst inequalities in income and wealth globally, he said, comparing the country’s statistics on income distribution with South Africa and Brazil. This has been corroborated by reports such as one by Credit Suisse in October 2015, which stated that the richest 1 per cent in India own around 53 per cent of country’s wealth. “India needs more transparency about income and wealth,” Piketty said, asserting that household surveys in the country vastly underestimate the levels of inequality.

While asserting that he was not going to be drawn into giving a lecture on reservations, Piketty emphasised that “may be in long run, the possible evolution on reservations should be on moving towards quotas based on “parental income and wealth, rather than caste”.

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While saying that the issue of quotas was very complicated, he said that while he believed in reservations as a concept to bridge inequality, in the long run though a shift might be desired.

First published on: 22-01-2016 at 12:45:46 am
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