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Does India Increasing Potential Inclusive Growth Polices? A Critical Analysis
Abstract and Figures
World Economic Forum (WEF) 2016 reported that India has mostly been ranked in the bottom half of
the 38 countries that make up our lower middle-income bracket. Particularly disappointing is its position in
terms of Fiscal Transfers, where it ranks 37th out of 38. It also ranks very low at 32nd for Tax Code and 36th for
social protection. The literature reviews show that India failed to understand the links between unemployment
and labor market institutions that foster inclusive growth. India was missing major opportunities to reduce
income inequality, access to health, education and failed to create economic infrastructure. The researcher will
measure the potential of Indian inclusive growth policies towards the achievements of Sustainable Development
Goals in India. In this context, the researcher will measure the idea of social opportunity function that is similar
to social welfare function. The proposed methodologies are applied to the India using its micro unit-record
household survey. The research results showed access to opportunities and basic infrastructure facilities were
not reaching to needy poor people in India. Monitoring by means of the opportunity curve is the one-to-one
relationship with the social opportunity function indicates inequalities are increasing day by day in the reform
period
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Using the 2004–2005 India Human Development Survey data, we estimate and decompose the earnings of household businesses owned by historically marginalized social groups known as Scheduled Castes and Tribes (SCSTs) and non-SCSTs across the earnings distribution. We find clear differences in characteristics between the two types of businesses with the former faring significantly worse. The mean decomposition reveals that as much as 55 % of the caste earnings gap could be attributed to the unexplained component. Quantile regressions suggest that gaps are higher at lower deciles, providing some evidence of a sticky floor. Finally, quantile decompositions reveal that the unexplained component is greater at the lower and middle deciles than higher, suggesting that SCST-owned businesses at the lower and middle end of the conditional earnings distribution face greater discrimination.
This paper attempts to explain the concept of pro-poor growth, and argues that it represents a major departure from the "trickle-down"phenomenon. It proposes a new indicator— the pro-poor growth index— that measures the degree to which growth can be considered to be pro-poor. The new indicator is used to analyze the nature of economic growth in three countries, namely, Lao PDR, Thailand and Korea.
This paper discusses the dynamics of economics, politics, and governance and its implications for the Indian economy in general and the governance issues of educational institutions in particular.
Independent India was founded on a democratic framework and an operational governance structure. The vision was to attain the specific economic and social goals that the country had set for itself. What is puzzling is the fact that despite the ideal combination of economics, politics, and civil service, the expected results were not achieved. What might have happened is the development of a substantial gap between the economically sound and the politically feasible policies, on the one hand, and the disharmony between the different levels of the administrative machinery, on the other.
The author agrees with the renowned economist, Hanson, who found an answer to the problem not in the theory of planning or the people making the plans but with the unrealistic assumptions about the likely responses of the people. For instance, it was assumed that the people elected to power, the citizens of the country, and the labour and management of the public enterprises would all work selflessly to achieve the economic objectives of the country. In reality, however, regional and sectional interests dominated the political and economic decisions making the Indian economy self-centric, narrow, and wasteful. The channelization of economic benefits to the special interest groups led to the lop-sided distribution of wealth. To add to this was the political corruption which was accepted as an unavoidable feature of the electoral process. Another blow came from the public sector enterprises which, instead of generating public savings, led to the accumulation of internal public debt and lower investment. What is unfortunate is that all this continued for a long time despite the realization that they were going against the basic assumptions of the post-Independence policy framework.
Taking the issue of fee determination in the case of IIMs, the author feels that it is again a complex interplay of the three elements - economics, politics, and governance. The economic issue from the public policy point of view is: why the larger subsidy from public funds and for whose benefit? While it is a popular political move to grant subsidies, it is a matter of conscious political choice as to which target group should get the benefit.
Towards making India's vision a reality, the author suggests the adoption of pragmatic and flexible approaches with the contemporary realities in mind. The steps would include: simplifying administrative procedures managing fiscal deficit through fiscal policy changes ensuring accountability through legal reforms avoiding bureaucratic interference eliminating administrative discretion
While a lot needs to be done in all these areas, the author is confident that with the economic potential of the country and the innate ability of the people of this country, it would definitely be possible to realize the full potential within the next two decades.
This paper first makes a comprehensive assessment of the performance of states in the post-reform period in terms of growth as well as reduction of income poverty and multiple deprivations. It then investigates whether there is any systematic relationship between growth and poverty and also between growth and inequality for the period 1993-94-2011-12. This analysis helps in understanding the proximate and structural factors underlying poverty and inequality. Based on the empirical analysis and review of approaches adopted by some of the Asian countries which have experienced a rapid reduction in poverty, the paper discusses pathways for India to hasten the process of poverty reduction.
Purpose
– The purpose of this paper is to ground in serious empirical evidence the debate on whether the post-reform acceleration in growth has helped bring poverty down for all economic, social and religious groups and in all state or has left certain groups or states.
Design/methodology/approach
– The paper uses unit-level data from the so-called thick rounds of expenditure surveys by National Sample Survey (NSS) in the years 1993-1994, 2004-2005, 2009-2010 and 2011-2012 and estimates the proportion of the population below the official Tendulkar line. Adequate care is taken to address the issue of sample size in reporting the estimates.
Findings
– Whether we slice the data by social, religious or economic groups, by states or by rural and urban areas, poverty has significantly declined between 1993-1994 and 2011-2012 with a substantial acceleration during the faster-growth period from 2004-2005 to 2011-2012. Poverty rates among the disadvantaged social groups and minorities have declined faster so that the gap in poverty rates between them and the general population has declined. In 7 of the 16 states with large Muslim populations, the poverty rate for them is now below that for the Hindus.
Research limitations/implications
– Use of survey data has its limitations, especially when the sample sizes are small. The paper also does not assess the direct contribution of growth in relation to that through redistribution.
Practical implications
– The paper presents implications for identification of the poor for the purpose of designing targeted interventions.
Originality/value
– This is the first paper to offer up-to-date estimates of poverty by social, religious and economic groups, by states and by rural and urban areas.
This paper attempts to review the recent performance of the economy and lists the priorities and challenges for the Twelfth Plan. The Indian economy will enter the Twelfth Plan period in an environment of great promise, but the next five years will also be a period of major challenges. The economy has done well on the growth front during the Eleventh Plan, but, going by the information that is at least currently available, not so well on inclusion. Much of what needs to be done to accelerate GDP growth during the Twelfth Plan will be done by the private sector, but the central and state governments have a crucial role to play in providing a policy environment that is seen as investor-friendly and is supportive of inclusive growth. Four critical challenges facing the economy in the Twelfth Plan, which are perhaps more serious than they were at the start of the Eleventh Plan, are those of (a) managing the energy situation, (b) managing the water economy, (c) addressing the problems posed by the urban transformation that is likely to occur, and (d) ensuring protection of the environment in a manner that can facilitate rapid growth. In addition, the efficiency in implementation of projects on the ground needs to be greatly improved.
Indian Inclusive Growth Strategies
- M Ahluwalia
Ahluwalia, M. (2007). Indian Inclusive Growth Strategies. New Delhi: Planning Commission.
Inclusive Growth toward a Prosperous Asia: Policy Implications. Manila: ERD Working Paper Asian Development Bank
- I A Ali
Ali, I. a. (2007). Inclusive Growth toward a Prosperous Asia: Policy Implications. Manila: ERD Working
Paper Asian Development Bank.
Pro-poor to inclusive gowth: Asian Prescriptions
Ali. J. (2007). Pro-poor to inclusive gowth: Asian Prescriptions. Manila: ERD Policy Brief No.48,
Economics and Research Department, Asian Development Bank,.
Regional Dimensions of Social Movement in India
- A Baviskar
Baviskar, A. (2015). Regional Dimensions of Social Movement in India, "Indian Rural Development
Report 2013-14", IDFC. New Delhi: Oxford University Press.