Ensure income for poor, invest in infrastructure: Thomas Piketty

NEW DELHI: Tax cuts for businesses are not enough for India to cope with the pandemic, and income guarantee for the poor and immediate investment in public infrastructure are needed to bridge inequality, said economist Thomas Piketty.

“It is not enough to have tax cuts for businesses; you also need to build a system so the poorest have adequate income support,” Piketty told Times Now in an exclusive interview with its editor-in-chief Rahul Shivshankar on Thursday.

The French writer, known for his works on wealth and income inequality, called for India to rethink its social policy and adopt a progressive taxation system for a more equitable redistribution of resources.


“In India, where most workers come from the informal sector, if you don’t create a fixed income scheme, it is not going to be enough,” he pointed out.

Piketty attributes China’s partial success in fighting the pandemic to investment in public infrastructure, saying, “The Indian democratic system has, so far, not been able to mobilise fiscal resources to invest in basic education or health.” He said the crisis should reinforce legitimacy for state action to rebuild infrastructure, adding, “In the immediate weeks and months, this has to be paid by extra public debt, but in the medium run, it will imply a more equitable tax system.”

Piketty said India’s public debt is at historically low levels, compared to wealthier nations.