The Rising Tide of Inequality and Nepotism in India: A Warning from Nepal’s Protests

In recent years, research has consistently linked rising socioeconomic inequalities to social unrest and street protests across diverse cultures and countries. Studies, such as those by the International Monetary Fund (2016) and the World Bank (2020), demonstrate that widening income gaps and perceived unfairness in resource distribution often fuel public discontent, erode trust in institutions, and spark mass mobilizations.

The recent protests in Nepal, particularly the violent demonstrations led by Gen Z on September 8, 2025, serve as a stark reminder of this correlation. These protests, driven by grievances against government corruption and policies that deepened inequalities, should prompt India to reflect on its own trajectory. Nepal’s unrest, targeting the luxurious lifestyles of “nepo kids” and policies like the privatization of tea estates under a nominally communist government, mirrors troubling trends in India—namely, entrenched nepotism, growing inequality, and democratic backsliding. Without addressing these issues, India risks similar social strife.Nepal’s Protests: A Cautionary TaleIn Nepal, the ruling Communist Party of Nepal (Unified Marxist–Leninist) faced widespread backlash for policies perceived to favor elites while neglecting the broader population. The privatization of state-owned enterprises, including tea estates, was seen as benefiting connected insiders, exacerbating economic disparities. 
Protesters, particularly from Gen Z, expressed outrage at the ostentatious wealth of politicians’ family members—dubbed “nepo kids”—who enjoyed luxurious lifestyles amid widespread poverty. The violent protests on September 8, 2025, in Kathmandu, which saw clashes with police and property damage, underscored how inequality, coupled with perceptions of corruption and favoritism, can ignite public fury. India, with its own rising inequalities and similar grievances, must heed this warning.Nepotism in India: A Symptom of InequalityNepotism, the preferential treatment of family members or close associates, is a significant driver of inequality in India, as it concentrates opportunities and resources among a select few. Two prominent examples illustrate this trend:

1. Jay Shah and the BCCI: Jay Shah, son of India’s Home Minister Amit Shah, was appointed secretary of the Board of Control for Cricket in India (BCCI) in 2019 and later became its chairman in 2024. At age 35, with limited prior experience in cricket administration, his rapid rise has drawn accusations of nepotism. The BCCI, one of India’s wealthiest and most influential sporting bodies, controls significant financial resources and media rights. Critics argue that Shah’s appointment, facilitated by his familial ties, exemplifies how elite networks monopolize powerful positions, sidelining meritocratic candidates and fueling perceptions of unfairness.
2. Nitin Gadkari and E-20 Ethanol Policies: Union Minister Nitin Gadkari has been a vocal advocate for introducing E-20 ethanol-blended petrol, promoting it as a step toward sustainable energy. However, concerns have been raised about potential conflicts of interest, as Gadkari’s family is linked to businesses in the ethanol and sugar industries. His sons are reportedly involved in companies that could benefit from the push for ethanol production. While no definitive evidence of wrongdoing exists, the perception of favoritism in policy decisions that align with family interests undermines public trust and reinforces narratives of elite privilege.

These cases, while not exhaustive, reflect a broader pattern where familial connections appear to grant undue advantages, deepening public frustration over unequal access to opportunities. Such perceptions of nepotism mirror the grievances in Nepal, where “nepo kids” became symbols of systemic inequity.Democratic Backsliding: A Threat to StabilityIndia’s democratic institutions, once robust, are showing signs of erosion, further exacerbating inequalities and public discontent. Several developments highlight this backsliding:

1. Electoral Bonds and Opaque Political Funding: Introduced in 2018, the Electoral Bonds scheme allowed anonymous donations to political parties, raising concerns about transparency and accountability. The Supreme Court struck down the scheme in February 2024, citing its potential to enable undue influence by corporate and elite donors. Data revealed that the ruling Bharatiya Janata Party (BJP) received the lion’s share of donations, fueling allegations of favoritism toward connected businesses. This opacity in political funding undermines democratic fairness and amplifies perceptions of a system rigged for the powerful.
2. Arbitrary Arrests and Suppression of Dissent: Reports from organizations like Amnesty International and Human Rights Watch have documented an increase in arbitrary arrests of activists, journalists, and opposition figures under laws like the Unlawful Activities (Prevention) Act (UAPA). High-profile cases, such as the detention of activists in the Bhima Koregaon case, have drawn criticism for lacking transparent evidence and stifling dissent. Such actions erode public trust in the rule of law, creating a climate of fear that can push grievances toward street protests.
3. Credibility of the Election Commission: The Election Commission of India (ECI) has faced growing scrutiny over its impartiality. Recent controversies, including delays in addressing complaints about electoral violations and perceived leniency toward the ruling party, have damaged its credibility. For instance, during the 2024 general elections, opposition parties raised concerns about the ECI’s handling of voter data discrepancies and model code of conduct violations. A weakened ECI risks undermining public faith in electoral processes, a key trigger for social unrest in unequal societies.

The Path Forward: Addressing Inequality and Restoring TrustThe parallels between Nepal’s protests and India’s current trajectory are striking. Rising inequalities, fueled by nepotism and elite capture, combined with democratic backsliding, create a volatile mix. India’s Gini coefficient, a measure of income inequality, has risen in recent decades, with the top 1% holding over 40% of the nation’s wealth (Oxfam India, 2023). This concentration of wealth, coupled with visible nepotism and institutional erosion, risks alienating large sections of the population, particularly youth, who may channel their frustrations into protests, as seen in Nepal.
To avert such outcomes, India must prioritize transparency, and institutional integrity. Strengthening independent oversight of appointments to public and quasi-public bodies like the BCCI, ensuring transparent policymaking free from conflicts of interest, and reforming political funding are critical steps. Additionally, protecting dissent and bolstering the autonomy of institutions like the ECI can restore public trust.
Nepal’s protests are a warning: when inequalities grow, and elites appear insulated from accountability, social strife is not far behind. India has the opportunity to act before discontent spills onto the streets. By addressing nepotism and democratic erosion head-on, the nation can foster a more equitable and stable future.

In this video, Prof. Richard Wolff gives a similar warning to the US.
Wolff Responds: "The Crisis Of Inequality" Dated September 10, 2025