Comparing the rise of India to America's Gilded Age raises eyebrows, according to Outlook magazine, which interviews former hedge fund manager and McKinsey veteran Jayant Sinha. But the evidence of oligarchy is there, the head of Omidyar Network India says:

"Russia is seen as an oligarchy and it trades at a discount and attracts less capital. That’s because policymaking there is not transparent, is often used to benefit some people and also because people are thrown into jail without any adequate justification and so on. India runs the risk of being viewed similarly. And because of that, we will find it difficult to raise capital (or it’ll be very expensive) because foreign investors will not be sure how their money is going to be treated in India."

"Oligarchy is going to cost us tremendously. If you look at political dynasties or business dynasties, the empirical evidence is that we’re definitely at risk, if we’re not there already."

So what should India do about it?

"If you look at the Progressive Era that followed the Gilded Age in the US, they actually broke up all those great trusts and prevented the accumulation of wealth and power in the hands of a few," says Sinha. "A very important structural reform—the estate tax—was also put in place. We need structural reforms like that in India. Anybody who has an estate of say, over Rs 25 crore, will pay an estate tax—so that it gets only the people who have accumulated very large amounts of assets. That’s a way of making sure that the next generation has a level playing field. This is because the power of compounding is such that if you had a million rupees in 1900 in Mumbai, you would have become one of the great business dynasties of Mumbai that we see around us (today)." 

For more about India's own Carnegies and Rockefellers, check out my article from last week: India's new robber barons.