"We have this strange cultural phenomenon called 'tall poppy syndrome'," she said.
"If you stand out, you will be cut down.
"One example is ... the New Zealand Book Award ... there was this kind of thing that now you've won this prize from overseas, we're not going to celebrate it here, we're going to give the award to somebody else."
Catton missed out on the New Zealand Post Book of the Year Award in 2014, which went to Jill Trevelyan for Peter McLeavey: The life and times of a New Zealand art dealer.
"So many people have talked in the media and me directly in ways of 2013 being the year that New Zealand won the Man Booker Prize," Catton said in India.
"It betrays an attitude towards individual achievement which is very uncomfortable. It has to belong to everybody or the country really doesn't want to know about it."
Artist Dick Frizzell, who was a judge at last year's book awards, told Radio New Zealand he felt as though Catton obviously still held on to some resentment for not taking home the top accolade.
"There were some other very very good books ... this is not the Booker this is a New Zealand prize."
He said Trevelyan's book celebrated New Zealand writing, and he called it a "New Zealand icon".
"We gave it the best book. Eleanor got the best fiction. We thought that was a nice symmetry there."
Hulme disagreed New Zealand had a "tall poppy" issue when it came to successful writers.
Author Eleanor Catton. Photo / Robert Catto
"I've had an enormous amount of support over the years. Not least to when [The Bone People] was declared the first classic New Zealand novel, which still makes me laugh."
Catton's views found support from Once Were Warriors author Alan Duff, who in an article for the Herald wrote: "I agree with most of what Eleanor has to say, especially the country claiming her individual effort ... like any novelist, she did it all on her own. Though I'd then say she should also be grateful that readers have bought her book in huge numbers."
He went on to write: "In my opinion we're a cultural wasteland which you can see reflected right across our media. A garbage-strewn land ruled over by mediocrities fiercely and ruthlessly possessive of the high ground they've seized."
In her comments in India, Catton said she had struggled with her identity as a New Zealand writer and felt uncomfortable being an ambassador for the country when it was not doing as much as it could, "especially for the intellectual world".
She criticised the Government as being dominated by "neo-liberal, profit-obsessed, very shallow, very money-hungry politicians" who didn't care about culture.
Duff said he did not agree with Catton's comments about the Government.
Catton's remarks were ridiculed by RadioLive broadcaster Sean Plunket, who yesterday labelled Catton an "ungrateful hua". "I don't see you as an ambassador for our country, I see you as a traitor."
MediaWorks spokeswoman Rachel Lorimer said Plunket defined a hua as "just a woman who annoys you".
Fergus Barrowman of Victoria University Press, which publishes Catton's work, said Mr Plunket's comments were "completely absurd".
"In terms of being a traitor, we show our love and gratitude to our country as much by holding it up to high standards as we do by celebrating it," he said.
"I just think it's amazing how something so innocuous can blow up so nastily so quickly."
Prime Minister John Key said he was disappointed Ms Catton "doesn't have respect for the work we do because I have tremendous respect for what she does as a writer".
Labour leader Andrew Little said Ms Catton was simply "calling it how she sees it".
"I understand what she's saying ... we do need to support the creative and expressive arts, it's a very important part of New Zealand.
"If she feels it's not being supported, then let's look at that, let's hear more about it, and see what we can do."
