Monday, 26 May 2014

Achieving Inclusive Growth: An Agenda for New Government (Posted on the occasion of Narendra Modi being sworn in as India’s Prime Minister)

Devendra Kothari PhD
Population and Development Analyst
Forum for Population Action, Jaipur

The Modi Government is empowered to realize its election promise – “Acchhe din aane wale hain” (better days to come) but now it must hit the ground running.

India is a great success story of economic growth and poverty decline, but it remains the home of global poverty as well as illiteracy, and half of its children are profoundly malnourished. This paradox of poverty and plenty poses one of the great intellectual and moral challenges of the day. The Indian model of development has so far worked poorly in promoting inclusiveness. Though India’s democracy is increasingly becoming more inclusive (even a Chaiwala, who prepare and sell Indian tea on streets, can aspire to become Prime Minister), its social system is growing increasingly exclusive. It appears India has not given due recognition to the concept of equality in sharing the resources in its development agenda. Even today, after more than twenty years of economic reforms, the visitor to India - whether from developed or developing world - is struck by the gross inequalities. Implementing the right set of policies to propel the equality at greater speed will have to be the foremost priority of the new government. The Modi government has to acknowledge this, and initiate program, which focuses on inclusiveness alongside growth. The post aims as how to achieve inclusive growth, which is  the main objective of the 12th Five Year Plan (2012-17).

Emerging scenario:
Socio-economic policy has lost direction on account of false choices presented in a growth versus welfare approach. They are not substitutes for each other. People will choose better living conditions over subsidy because it provides the best vehicle for personal advancement or human development. That may be reason why Indian voters have given a decisive mandate and put their faith in inclusive development and governance. All the human development indicators show that country has had a terrible experience in the last ten years. In fact, things are going from bad to worse. The Human Development Index (HDI), an easy-to-understand equality measure, is made up of what most people believe the very basic ingredients of equality or well-being: health, education, and income. HDI ranks countries from top to bottom on the level of human development. India’s rank has fallen from 128 in 2003 to 136 out of 187 countries and territories in 2013. Further, India still has quite long way to go in bridging the gender gap in the areas of health, education and economics, if not politics. It has been ranked 101 among 136 countries in The Global Gender Gap Report 2013 released by the World Economic Forum. Also, the country has fallen from 96th rank in 2006 to 101 in the last 8 years, revealing a stark and deep rooted gender gap in India. In addition, recent studies paint a grim picture of education, posing the risk of eroding the long-term competitiveness of World’s third largest economy. Today, more children are going to school but what they are learning is not clear.  This is alarming and pathetic. Lastly, a recent report of OECD reported that India’s income inequality doubled in the two decades to 2011.

The way forward:
So what need to be done to unlock India’s potential? In other words, what should be agenda for inclusive development?  No doubt, putting the economy back on track and reducing inflation should be the new government’s first priority, however, for inclusive growth and sustainable development it is equally important to focus on human development. And it is a prerequisite to achieve inclusive growth.  It is argued that the country's main problems lie in the lack of attention paid to the essential needs of the people, which are must for the human development. Central to the human development approach is the concept of capabilities. Basic capabilities valued by virtually everyone include: good health, access to knowledge, and a decent material standard of living. The young demographic profile of the country also favors this agenda. Here are five areas towards which the New Government’s efforts should be focused.

·     First,  no doubt, provision of universal healthcare is an essential requirement for a speedy human development. So it is justifiably argued by Prof. Dipankar Gupta that: “Get Well First, Get Wealthy next”. However, stabilizing population is an essential requirement for promoting sustainable health as well as development. While India's population growth rate has been declining over the years, the overall population will continue to grow as 51% of the population is in the reproductive age group (15-49). Millions more will join this cohort each year.  At current levels, it may take several decades more to stabilize the population.  Although India has adopted several impressive goals to reduce its population growth rates, the country has a long way to go to achieve meaningful population controls with a growth rate of 1.6%, representing a ‘doubling time ‘of less than 44 years. Health will be wealth only if nation manages its population growth.
     one has to recognize that population is an important factor in development, especially when it is growing seemingly out of control since it leads to a significant diversion of national investable resources to consumption which could otherwise be used for increasing investment and productivity and for improving the quality of public social services such as education, health, sanitation, provision of safe drinking water and for control of environmental degradation. India’s population has grown from 846 million in 1991 to 1210 million in 2011- that is by 364 million  in the last  twenty years,  and is still growing by around 17 to 18 million every year. India’s population is projected to peak at 1700 million in 2060. Current population growth is mainly fuelled by unwanted fertility. More than four in ten pregnancies are unintended/unplanned or simply unwanted by the women who experience them and half or more of these pregnancies result in births that spur continued population growth.  

Today 26.5 million babies are born each year and out of this about 6 million births could be classified as unwanted. It is estimated that around 450 million people out of 1200 million in 2011 in India who were result of unwanted pregnancies and most of them are from the lower economic strata.[1] The consequences of unintended pregnancy are serious, slowing down the process of socio-economic development as well as process of change, and is being reflected in widespread hunger, poor health poverty, under educated labour force, unemployment,  regressing governance as well as increasing scarcity of basic resources like food, water and space despite concerted developmental efforts since 1991.[2]

There may be several reasons behind unwanted childbearing, but most important one is related to the imperfect control over the reproductive process.  So letting women have the means to manage their childbearing will help to make India a more stable and equal  place. When women have access to contraception appropriate to their needs, desires, and budgets, the potential benefits are many, including reduced maternal and child mortality as well as lesser number of abortions and unwanted pregnancies. In addition to its health benefits, family planning allows families and communities to invest more in education and health care and helps reduce poverty, as argued by the President of Population Council, Peter J. Donaldson.

Children by choice not by chance are the only way poor can aspire a better life and good health. For this, direct efforts aimed at decreasing the rate of natural increase of population should be intensified through greater access to suitable voluntary reproductive health services, information, and education and of acceptable methods of family regulations. Also, fertility reduction efforts, beyond family planning, should become an integral part of the planning for human development, and should aim at improving quality of life of the family and the status of women.[3]

·         Second, another issue which needs equal attention is quality of education. It is fashionable now to talk of India’s demographic dividend. By 2030, India will be the youngest big nation in the world, with an average age of 29. Can India take advantage of this demographic window in the next couple of decades and garner its benefits? Unprecedented thrust on education and skill development is the only way to do justice to the politics of aspiration. 

·         Third, physical living conditions are equally important in producing an enabling environment for quality of life or human development. Only 47% of households have a source of water within the premises while 53% of households travel more than a kilometre in rural areas and more than 100 meters in urban areas to fetch their supplies, as per the findings of Census 2011. This problem is further compounded by lack of access to sanitation. About half of total households in India still defecate in open. This situation is particularly piquant for women and girls.  It is estimated that around 290 million women in India in 2011, the worst sufferers of open defecation, continue with the age-old practice even after 20 years of economic reforms.  Any improvement in access to toilet facilities, water, electricity and LPG is likely to result in a considerable reduction in domestic drudgery especially for girls/women, freeing up their time for other activities including schooling and perusing professional life.

·         Fourth, India is simply not doing enough for its women to improve access to resources and freedom of movement as well as improving decision making power.  To deal with a problem that has roots in social behavior and prejudice, mere legislation is not enough. One has to create an environment where sons and daughters are equally valued.  For this, women must have access to education and training along with economic empowerment through property rights, etc.[4]

·         Lastly, since non-agricultural sectors will drive most of India’s future growth, this growth will mainly show up in the development of cities and towns. The level of urbanization in India, unlike the experience of several Asia’s miracle economies, has been quite low. It increased sluggishly from 17.3% in 1951 to 31.2% in 2011. As such, India has to invest heavily in manufacturing and service sectors, which encouraged farmers/rural people to move to more productive jobs in urban centres. So far, India has encouraged rural people  to stay home by subsidizing rural incomes through programs like:  NAREGA (National Rural Employment Guarantee Act), Food Security Bill, etc.

In conclusion, there is an important lesson one can learn from history. When Asia’s miracle economies thought about inclusive and sustainable development, they invested heavily in human development. It is high time that political parties focus on improving people’s ability to earn more rather than dolling out subsidies that make people dependent on the political class and system.  The immediate vision of India’s development planning must, therefore, ensure broad-based improvement in the quality of life of the people, especially those belonging to the bottom of pyramid. The above noted action areas are much effective interventions in achieving inclusive growth, and India must think about. This does not require too much by way of resources, but reorientation of the priorities. India spends considerable resources on subsidies and freebies which could be used for the human development. To make India relevant again, the Modi government has no time to lose.

[1] Kothari, Devendra. 2011. “Implications of Emerging Demographic Scenario: Based on the Provisional Results of Census of India 2011”,  A Brief,  a publication of Management Institute of Population and Development – A Unit of Parivar Seva Sanstha, New Delhi.  

[2] Kothari, Devendra. 2014. “Managing Unwanted Fertility in India: Way Forward”, In Institute of Economic Growth (ed.):   National Rural Health Mission: Achievement and Challenges, New Delhi: Book Well (to be published in July, 2014), pp 68-86.

[3] Kothari, Devendra. 2012. “Empowering Women in India through better Reproductive Healthcare”, in Sheel Sharma and Angella Atwaru Ateri (eds.) Empowering Women through Better HealthCare and Nutrition in Developing Countries, New Delhi: Regency Publications.

[4] Kothari, Devendra. 2014. “Empowering women in India: Need for a Feminist Agenda”, Journal of Health Management, 16 (2), pp 233-43.

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