This is the second of a two-part series on inequality in India. This article draws on the Access (In)Equality Index (AEI) 2026, produced by the Centre for New Economics Studies (CNES) at O.P. Jindal Global University. All figures cited are from the AEI 2026 report. Read the first part here.§As one plots the Access (In)Equality Index (AEI) 2026 data profile for India as a nation, a pattern appears before any single statistic is produced or run. This has to do more with geography and what it shows in numbers. The southern states crowd the top of the index. No state in central or eastern India reaches the group of best performers. And no state in the west, the centre or the south falls into the group at the bottom. This raises an uncomfortable question for anyone who believes that state policy decides outcomes. How much of a state’s access is simply a matter of where it happens to be?More than half is geographyThe AEI 2026, produced by the Centre for New Economics Studies at O.P. Jindal Global University, groups the 28 states into six regions and asks how much of the variation in their scores lies between regions rather than within them. The answer is 54%. Knowing only which region a state lies in tells you more than half of what there is to know about how it compares with the others.Part of this is income, since the southern states are also the richest on average. But geography does not disappear once income is accounted for. Even among the income-adjusted scores discussed in the first part of this series, region still accounts for about a third of the variation. On average, southern states deliver more access than their incomes predict, while western and north-eastern states deliver less.The pull of a region is not the same in every area of life. It is strongest in justice and weakest in education.Figure 1. How much of the gap between states is explained by region, pillar by pillarThis pattern is consistent with schooling being more responsive to a state’s own policy effort, while justice and social security are shaped by long administrative histories that neighbouring states tend to share. Schools, it seems, respond more readily to what a state does. How courts and police reach people appears to change far more slowly.The region that refuses to behave like oneGeography is a strong influence, but it leaves room for states to differ.The North-East is the clearest proof. It is often discussed as a single policy region, yet it contains Sikkim, one of the best performers in the entire index, and Manipur, which shares the lowest score of all. The spread of scores within the North-East is wider than the gap between any two regional averages, including the gap between the South and the East. The northern states tell a similar story, with Himachal Pradesh near the top of the index and Uttar Pradesh near the bottom.States that share terrain, history and neighbours can still arrive at very different places.The trapThe second pattern concerns the five pillars themselves. If basic amenities, education, health, socio-economic security and justice moved independently of one another, a state weak in health might easily be strong in schooling or justice. The AEI 2026 finds the opposite. Every pillar is positively related to every other, and the closest link of all is between socio-economic security and health. The pillars measure very different things, yet they tend to pick out the same states as leaders and the same states as laggards.The clustering is sharpest at the two ends. When states are divided into thirds on each pillar, three states fall in the bottom third on every single one of the five. All three are in the east and the north-east. At the other end, four states sit in the top third on all five, two small hill states, a coastal state and Kerala. Perhaps most telling of all, twelve states never reach the top third on any pillar.Figure 2. Where each state falls on the five pillars, top, middle or bottom thirdFor residents of the states at the bottom, this means a shortfall in one service is unlikely to be offset by strength in another. In these states, weaker access to health care tends to come together with weaker schooling, thinner economic security and a justice system that is harder to reach. Disadvantage, in other words, compounds.This is also why the design of an index matters. The AEI 2026 combines its pillars in a way that does not allow a strong pillar to mask several weak ones. That property matters most in exactly the states where weaknesses accumulate, and it is in those states that a simple average would flatter the picture most.The exceptions worth noticingA few states break the pattern, and they may be the most instructive of all. Nagaland ranks among the very best states on justice while sitting near the bottom on education, socio-economic security and health. Punjab ranks among the leaders on basic amenities and education but falls well behind on socio-economic security and health.States with uneven profiles like these have a clearer target, namely the particular pillar holding them back. For the states that sit in the bottom third across several pillars, the lesson is different. Schemes confined to a single sector are unlikely to be enough on their own, and coordinated action across several areas at once may be needed to break a cycle of compounding disadvantage.Between income and geographyRead together, the two parts of this series point in the same direction. Income explains much of the gap in access between Indian states. Geography explains much of it too. Neither explains all of it.Andhra Pradesh delivers far more than its income predicts. Sikkim leads a region whose averages lag. Bihar does more with less than almost any other state. Education responds to a state’s own effort more than its neighbours’ histories. These cases mark out the space in which state governments make a real difference.The map tells you where a state starts. The AEI 2026 suggests that where it ends up still depends, in good part, on what it does.Measuring the prosperity gapThe Prosperity Gap is an indicator adopted by the World Bank that measures how far a society is from the baseline standard of prosperity. Introduced to promote the goal of prosperity, the criteria aim to increase sensitivity to distributional issues, shifting the conventional understanding of economic development away from average per capita income, and emphasising that good growth should benefit the least advantaged in society. As per the recent brief, India’s Prosperity Gap is 4.9, measured against the global benchmark of $28 per person per day (in 2021 purchasing power parity terms). Hence, the average consumption levels across India’s population will need to increase by a factor of 4.9 to reach the desired standard of prosperity. Since improvements in the earnings of poorer persons contribute more significantly to reducing the prosperity gap, India’s score of 4.9 leads to the implication that despite substantial reduction in poverty, the nation must still strive for prosperity. A closer inquiry into the World Bank’s poverty estimates reveal this marked unevenness in development.In 2023, an estimated 2.6% of Indians lived below $3.00 a day (the extreme poverty line), 16.1% below $4.20 (the lower-middle-income line) and 80.0% below $8.30 (the upper-middle-income line). Calculating the difference between successive thresholds, about 64% of the population lay between $4.20 and $8.30. These percentages assist in inferring a segmentation of the Prosperity Gap which is the average, across all people, of $28 divided by each person’s daily income. The resulting gap is the factor by which that person’s income must rise to reach the benchmark. For instance, a person earning $8.30 needs a factor of 3.4 to be considered prosperous. The brief gives only the share of people in each band, so the factors at the band’s extremities can provide estimate ranges of possible contributions to the Gap. On this basis (the author’s calculation): Hence, it can be estimated that the 63.9% between $4.20 and $8.30 constitute the largest share of 4.9, leading to the inference that India’s Prosperity Gap remains high because many Indians who have left poverty, require their incomes to rise three to seven folds in order to reach prosperity. This data point indicates that this aspirational upward hike is difficult, and the factors that have helped escape poverty are not necessarily the same as those needed to achieve prosperity. Mobility and human capital marketsWhile escaping poverty is a statistical phenomenon, building a secure socio-economic life is a labour-market driven occurrence, and evidence suggests that India’s labour market is still not seamlessly transforming the first event into the second. The World Bank brief itself flags this issue by stating that real earnings are broadly flat, employment growth is concentrated in low-productivity work, and youth unemployment rose from 14.6% to 15.9% (Q1 FY2026 to Q1 FY2027). The data depicts that individuals exiting poverty are being met with weak jobs and uncertain routes to middle-income subgroups. Consequently, the underlying factors explaining the friction in a shift to a prosperous life, imply that while employment is expanding, the quality of available jobs is concerning.For instance, the International Labour Organisation (ILO) India Employment Report 2024, found that approximately 90% of India’s workers were informally employed, with self-employment accounting for 55.8% of employment in 2022. The 2025 Periodic Labour Force Survey (PLFS) annual report provided only a modest relief, with regular wage work noted to have risen from 22.4% in 2024 to only 23.6% 2025.Informality is reinforced by research that unveils that an increase in employment can be the result of distress, rather than opportunity. Using PLFS data it has been recorded that the share of unpaid family helpers among all workers increased from 12.41% in 2017-18 to 17.10% in 2023-24. This leads to an unfortunate deduction that increased employment does not necessarily translate to an expansion of well-paying, tertiary sector jobs. One of the strongest indicators that the market is not functioning at its best, is the fact that young entrants face the harshest undercurrents when entering the workforce. National Council of Applied Economic Research (NCAER)’s analysis of the Time Use Survey 2024 found that only 46.7% of 20–29-year-olds were employed, with occupational opportunities varying across states. The most startling figures pertain to the educated youth, as according to The India Employment Report 2024, educated young people accounted for approximately 65.7% of India’s unemployed youth in 2022. This phenomenon highlights a mismatch between qualifications young people are acquiring and the employment opportunities available to them. Interestingly, households striving to enter the middle-class through improved education and healthcare, find themselves buying services they may not be able to easily evaluate when selecting. Das and Dobbin, describe ‘human capital markets’ as riddled with a plethora of fee-charging private providers of education and health, in which quality is difficult to determine, and services are a consumption and investment. Paid schooling and care do not always guarantee the intended human capital formation, materialising in graduates being unable to convert their investments into employment opportunities. A paradox that minimises the gains sought to follow increased employment, is that even when people are employed, their earnings may not be sufficient to nudge them into a more comfortable economic position. This can occur because of real wages remaining broadly flat, as observed by the World Bank brief, and substantiated by the ILO’s India Employment Report 2024, which pegged real wages for regular, salaried workers to have remained stagnant or having declined between 2012-2022. The report highlights that being able to consume has very little to do with one’s job security, if earnings are not adjusted to the inflationary currents of the market. India has proven that it can combat poverty, however it is yet to prove that it can foster prosperity. Even though many have breached the poverty line, the Prosperity Gap remains a caution that for an average Indian a stable, comfortable life is still out of reach.For Indians, the journey between escaping poverty and arriving at prosperity will require tackling structural and institutional barriers that dictate who can progress and who only survive. The country has already achieved the first basic feat for reduction in extreme income poverty. Now, the focus for an aspiring country to become developed would require a transformational shift in supporting more prosperity-enhancing growth that secures and promises better livelihoods, effective human capital building services, and genuine economic and social opportunities from the bottom to the top of the social, economic pyramid. The road to doing that seems far ahead at this point. Deepanshu Mohan is dean and professor of Economics at O.P. Jindal Global University. He is a visiting professor at LSE and a research fellow at University of Oxford. Ankur Singh is a senior research assistant at Centre for New Economics Studies and studied Economics and Public Policy at O.P. Jindal Global University. Mahi Dutta is a research assistant at Centre for New Economics Studies and studies Economics and Public Policy at FLAME University, Pune.