Do the economic policies or the “business model” adopted by China and India necessarily aggravate inequalities in income and wealth distribution, and thus exacerbate social contradictions? While not providing a definitive answer, the article examines the rising concentration of income and wealth, the trends in poverty, employment and unemployment, the nature and extent of social unrest, and how the rich are getting richer, aided by fiscal sops, and outlines a feasible alternative centred on development with equity.