The Indian Growth story has evoked a variety of responses – India Shining, Asian tiger, giving China a run for its money etc. etc. More recently however, journalists in India and abroad have been commenting on a daily basis on the blips in the growth rate and how it will impact the poor (hysterically on TV and print, as if the growth of any economy can be realistically monitored on a daily basis!)! A recent article in the The New York Times (http://www.nytimes.com/2012/05/06/business/economic-view-forget-europe-worry-about-india.html) “Never Mind Europe Worry about India” discusses the fall in growth rate in India stating – What is disturbing is that much of the decline in the growth rate is distributed unevenly, with the greatest burden falling on the poor. If the slower rate continues or worsens, many millions of Indians, for another generation, will fail to rise above extreme penury and want. At this point I have to ask – What about the distribution when the growth rate was rising? The very same “poor” referred to in the article did not see the benefits of any of that growth so the situation can’t get worse! The disconnect in understanding the relationship between growth and development (evident in the NYT article) is prevalent also among our policy makers and planners as well and among most urban Indians.
In this context I must cite a recent piece in the Times of India on “Growth pangs” (http://timesofindia.indiatimes.com/home/sunday-toi/special-report/Growth-pangs/articleshow/13757467.cms) I couldn’t help but laugh at the question raised – “Why is an emerging economy doing so badly on human development index?” What a naive question? The article concludes with – At the heart of India’s skewered development story lies the paradox between India’s phenomenal GDP growth and its abysmal score on human development. This is what happens when there is an all pervasive disconnect in the understanding of the relationship between growth and development! An increase in growth rate (measured as GDP) is not a magic bullet to alleviating poverty. What is this growth? Where is this growth taking place? At what cost and who’s cost? If there are any benefits from this growth where is it being channeled?
In the face of this disconnect one wonders how rural India is going to lift itself out of poor sanitary conditions, poor health, debt-traps into which people have fallen due to skewed and distorted Government policies. However, encouraging stories of innovation and courage (both in working with and working the Government), from rural and marginalised communities learnt through personal experience and from reports indicate that in spite of the disconnect in Governance, communities are empowering themselves towards a better life. More on some of these stories later……………..