Reducing inequality and redistributing wealth are ideas that have sparked revolutions, toppled governments, and enabled despots. Such ideas have also elevated some nations — especially Scandinavian ones and a few in Europe — as paragons of social justice. The Indian government has been grappling with the same ideas for the larger part of a century now, but can’t seem to decide on how much of a Robin Hood to be.
From Indira Gandhi’s ‘Garibi Hatao’ to Manmohan Singh’s ‘inclusive growth’ to Narendra Modi’s ‘Sabka Saath Sabka Vikas’ – income inequality has never really left Indian political imagination. This week, it all came down to two primal fears of Hindu voters – Muslims and Mangalsutra.
Should the government take from the rich (‘steal’ in the context of taxes might be a bit harsh) and give to the poor? The Congress has tried this in the past. Or should it simply give to the poor without taking from the rich? The Modi government is trying this now.
Either way, the issue of inequality and redistribution is once again on a hot streak — stressed by Rahul Gandhi, Narendra Modi, and pretty much everyone with an opinion — and that’s why it is ThePrint’s Newsmaker of the Week.
It’s naturally an evocative issue and no wonder that Rahul Gandhi’s 2014-15 remark of the Modi government being a ‘suit-boot ki sarkar’ resonated so well with the public. It hit the right chords with his supporters while also twanging away at the establishment’s nerves.
Add to this a recent study, co-authored by Western economists like Thomas Piketty, which claims that inequality in India is higher than it was in the British Raj, and you have a situation ripe for an escalating conflagration of assertions, half-truths, and incendiary statements.
That’s pretty much how we entered this week.
Also read: Congress attacks on Ambani-Adani won’t fly. Nature of wealth has changed since Indira days
Inheritance tax rears its head again
The ball was sent rolling and, indeed, careening wildly by Indian Overseas Congress chairman and long-time Gandhi family advisor Sam Pitroda earlier this week, when he called for a discussion on whether India needs an “inheritance tax”.
Speaking at a rally in Chhattisgarh on Wednesday, Modi referred to Pitroda’s comments and said the mantra of the Congress was “loot zindagi ke saath bhi aur zindagi ke baad bhi” (Congress will loot you during your life and beyond it), a play on the popular tagline of the Life Insurance Corporation of India.
Meanwhile, the Congress leapt into damage-control mode, with its communications-in-charge Jairam Ramesh taking to X to assure everybody that “the Congress has no plan whatsoever to introduce an inheritance tax”. Praveen Chakravarty, chairman of the All India Professionals’ Congress and a key member of the party’s manifesto committee, wrote an entire article on it.
Chakravarty even went so far as to fling Pitroda under the bus, referring to his statement as “a past-his-prime Congressman’s stray comments”. Talk about desperate damage control…
The thing is, the Congress has already tried the inheritance tax experiment, and discarded it as a failure. Back in 1953, the Jawaharlal Nehru government brought in the tax — called the estate duty — to reduce inequality and provide states more resources. The British government had been talking about such a tax in India as far back as 1935.
By 1985, the Rajiv Gandhi government found the estate duty had comprehensively failed, and so abolished it. Other attempts to redistribute wealth through taxation, such as the gift tax and the wealth tax, lasted longer — being removed in 1998 and 2016, respectively.
Also read: Rajeev Chandrashekhar is modern, moderate. But tragically loyal to bigoted BJP
Modi, Rahul & Mangalsutra
Parallel to this, there also arose the controversy around Modi’s speech in Rajasthan, where he said that former Prime Minister Manmohan Singh had once remarked that Muslims had the first claim on the nation’s resources.
“This means they will distribute this wealth to those who have more children, to infiltrators,” Modi said in Hindi.
The outrage that followed was stupendous, with social media enthusiasts sharing and re-sharing his speech — which might have done as much harm as good — and making all kinds of fun of the Election Commission for remaining silent. Even the international media took note.
Unfazed, the PM on Tuesday reiterated his assertion that the Congress would redistribute the country’s wealth and give it to ‘select people’.
What likely emboldened him to stick to this message was Rahul Gandhi doubling down on statements of his own that had created quite a stir.
When the Congress released its manifesto earlier this month, Gandhi said the Congress, if voted to power, would not only hold a survey to determine who holds India’s wealth but would also do something ‘revolutionary’ about it.
“We will hold a financial and institutional survey after that,” Gandhi said. “Yeh pata lagayenge ki Hindustan ka dhan kiske hathon mein hai, kaun se varg ke haath mein hai. Aur is aitihasik kadam ke baad hum krantikari kaam shuru karenge. (We will find out in whose hands the nation’s wealth is in, which class of people they are. And after this historic step, we will undertake revolutionary work).”
This, too, was used extensively by Modi to rile up crowds. Evocatively, he warned people that the Congress wanted to ‘X-ray’ the nation — a term Gandhi himself used — and take the Mangalsutras of the women, confiscate their stree-dhan, seize any extra property held by anybody, and redistribute it all.
Over this last week, Gandhi has reiterated his financial survey remark, although he clarified that he hadn’t mentioned any actions to be taken on the basis of such a survey.
With both leaders not backing down, the Election Commission on Thursday finally issued notices to the Congress and the BJP over the remarks made by Gandhi and Modi. This, too, created quite a stir since the notices didn’t go to the alleged violators individually, but to their respective parties.
Inequality in more than just politics
Now, if you thought that the issue of wealth redistribution was restricted to the political domain, please keep an eye on the courts — no less than a nine-judge bench of the Supreme Court headed by the Chief Justice of India — and what it will decide about whether the private property of an individual can be regarded as resources of the community.
And while the redistribution discussion has been about the rich and the poor, let’s not forget that India often has a wealth difference even between husband and wife. Incredibly, even this aspect was covered this week. The Supreme Court on Thursday said that ‘stree-dhan’ is the “absolute property” of the wife and that the husband has no title over it.
The issue of inequality will likely die down in a few days, replaced by something else that captures headlines, but the last week saw it assume the blazing limelight — a position it should assume every once in a while.
The author tweets @SharadRaghavan. Views are personal.
(Edited by Prashant)