November 26, 2024, marked the 75th anniversary of the adoption of India’s Constitution, a milestone that invites reflection on the vision set forth by the Constitution makers and how it aligns with the realities of contemporary India.

Constituent Assembly’s Focus on Liberalism

• The debates in the Constituent Assembly aimed to create a liberal framework that could accommodate India’s diverse cultural, social, and economic identities.
• The Constitution envisioned a state that would actively work to reduce inequality through interventionist measures, while also promoting liberty as a core value.

Enroll now for UPSC Online Course

• In India’s context, the framers leaned towards positive liberalism due to the deeply entrenched social and economic inequalities at the time of independence. 
• The Constitution-makers saw the need for the state to play an active role in addressing these disparities, such as caste-based discrimination, widespread poverty, and low literacy.
• Therefore, the Constitution was designed to empower the state to act positively, through measures like affirmative action (reservations) and Directive Principles of State Policy (DPSP) that call for wealth redistribution, improved social welfare, and the elimination of inequality.

Judicial Endorsements emphasizing the welfare state and equality

• D.S. Nakara & Others vs Union Of India (1982): In this case, the Supreme Court reaffirmed the socialist framework embedded in the Constitution. 
  • The Court emphasized that the fundamental purpose of socialism is to ensure a decent standard of living for working people, and social security from “cradle to grave.” 
• Air India Statutory Corporation vs United Labour Union & Ors (1996): The Court reiterated that the ideological aspects of the Indian Constitution, particularly in the Preamble, Fundamental Rights, and DPSP, aim to establish an egalitarian social order. 
• Samatha vs State of Andhra Pradesh (1997):  The Court interpreted that the meaning of the word “socialism” in the Constitution is to reduce inequalities in income and provide equal opportunities and facilities to create an egalitarian social order.
• State Of Karnataka vs Shri Ranganatha Reddy: Justice V.R. Krishna Iyer’s interpretation of Article 39(b) of the DPSP that public and private resources fall within the ambit of community resources, was in line with the constitutional ideology of creating an egalitarian society.
  • This strengthened the state’s power of redistribution of resources for common good towards reducing inequality.

Check Out UPSC NCERT Textbooks From PW Store

Rising Inequalities Post-Economic Reforms

Economic Reforms in the 1990s

• Adoption of Neoliberal Policies: In the 1990s, India adopted neoliberal economic policies that focused on a market-driven economy.
• Reduced Government Interference: These policies led to less government intervention in the economy, shifting towards a more privatized model.
• Prioritization of Private Capital Investment: The reforms emphasized boosting private capital investment, especially in sectors such as technology, finance, and infrastructure.
• Gradual Withdrawal of Welfare State Commitments: As part of the neoliberal agenda, there was a gradual reduction in welfare state interventions, leading to a decreased focus on social security and redistribution of wealth.

Consequences

The shift towards a market-oriented economy resulted in a gradual increase in income inequality, with wealth becoming increasingly concentrated in the hands of a few, exacerbating social and economic disparities.

Documented Inequality Trends

1. Lucas Chancel and Thomas Piketty’s Research:
   • Pre-Independence Period: Top 1% of earners had a 21% share of total income in the 1930s.
   • Post-Independence Welfare Era: Due to state interventions, this reduced to 6% in the 1980s.
   • Post-Neoliberal Reforms: The share of the top 1% rose sharply to 22% by 2022-23, surpassing pre-Independence levels.
2. State of Inequality in India Report 2022
   • This report prepared by the Institute for Competitiveness and commissioned by the Economic Advisory Council to the Prime Minister, highlights Periodic Labour Force Survey (2019-20) according to which:
   • Top 10% of earners receive an annual income of ₹3 lakh, while 90% earn less than ₹25,000 monthly.
   • The remaining 90% of the population earns less than ₹25,000 per month, exposing stark income disparities.

Social Dimension of Inequality

• Inequality in India is not confined to economic disparities but deeply intertwined with social hierarchies, including caste, gender, region, and education. 
• The social dimension exacerbates economic inequality, leading to a cycle of marginalization for disadvantaged groups. 
• According to the 2024 report “Towards Tax Justice and Wealth Redistribution in India”:
• 90% of billionaire wealth is held by upper castes.
• Scheduled Tribes have no representation, Scheduled Castes only 2.6%, and OBCs just 10%.
• From 2014 to 2022, the OBC share in billionaire wealth dropped from 20% to 10%, while the upper caste share rose from 80% to 90%.

Enroll now for UPSC Online Classes

Conclusion

While India has made significant strides in democracy, political participation, and economic growth, the egalitarian vision of the Constitution remains elusive. Unresolved social and economic inequalities threaten the stability of democracy, highlighting the urgent need to realign policies with the Constitution’s ideals to achieve true equality.

DOWNLOAD PDF