Planning for Exclusive Growth
An evaluation of 20 years of Globalisation
Prof.B.M.Kumaraswamy,
National Co-convener,
Swadeshi Jagaran Manch
The process of Globalisation started in India in the year 1991. The present Prime Minister who was the Finance Minister in the 1991 P.V.Narasimha Rao Government, Is hailed as the architect of Free Market Economy or Globalised Economy in India. By 2011 the policy of Globalisation in India completed 20 years. It is a reasonably long time to evaluate India’s Experiences with Globalisation. During this period of 20 years – 1991-2011, we have completed 4 five year plans i.e. 8th, 9th, 10th & 11th Five year Plans.
Parameters of Evaluation
The broad Parameters for evaluation of economic growth over this 20 year Globalisation Period are set by Prime Minister Manamohan Singh himself.
In his First Broadcast to the Nation as Prime Minister on 24th June 2004 (U.P.A.I.Government) Dr. Manamohan Singh told as follows,
“Growth is not an end in itself. It is a means to generate Employment, Banish Poverty, hunger and homelessness and improve the standard of living of our people. It must also be environmentally sustainable.”
The success or failure of the Globalisation Policy can be evaluated with reference to our achievement in the goals of,
a) Employment Generation,
b) Eradication of Poverty, (Hunger & Homelessness),
c) Improvement in the standard of living of people,
d) Environmental sustainability of Growth.
Increase in G.D.P.
Over the 20 year period of Globalisation India has really experienced high growth rate of its G.D.P. During the 1980s our G.D.P. growth rate was about 5-6%. However since 2003-04 it attained more than 8%. In the years 2005-06, 2006-07 and 2007-08 our G.D.P. Growth rate exceeded 9%. During the 11th plan period (2005-11) 8.2% growth rate was achieved. The Approach Paper to the 12th plan thinks it reasonable to aim at 9% growth rate during the 12th plan period.
India A Trillion Dollar Economy
In the year 2007 India became a Trillion Dollar Economy, having crossed a G.D.P. of one trillion Dollars. India joined the exclusive 12 nation club of Trillion Dollar Economies, as the 12th member. The other countries of the club are, U.S., Japan, Germany, China, U.K., France, Italy, Canada, Spain, Brazil and Russia. Thus it is clear that in India there is no resource constraint to achieve the goals enunciated by the P.M. But have the plans really attained the goals?
1. Employment Generation
India being the second most populous country in the world, having 121 crore people as per 2011 census, really needs a strong employment centric development model. However the Western Free Market model that we are blindly following has miserably failed in generating adequate good quality jobs for the masses. It is well recognised that India is following a jobless growth path. ‘Jobless growth is joyless growth’ – goes the saying. Generation of adequate number of good quality jobs is the royal path for the poverty reduction and inclusive growth.
All the plan documents of this period speak loftily about the importance of employment generation, but the end result is negative.
The rate of unemployment has increased from 6.1% in 1993-94 to 7.3% in1999-2000 and further to 8.3% in 2004-05.
The 66th round National Sample Survey Report on Employment and Unemployment during 2004-05 – 2009-10, published recently bears ample testimony to the failure to generate jobs. It states that the growth rate of employment of all kinds, which was 2.7% during 1999-2000 – 2004-05, has come down to 0.82% in the period of 2004-05 –2009-10. It also points out that casualisation of labour has increased during this period. It also points out that the work force consists of,
Self Employed ----------------------------- 51%
Regular wage Employment ------------- 16%
Casual Employment -----------------------33%
This speaks of the rapid fall in the quality of jobs available.
The CRISIL Research Study Report says that India needs at least 55 million additional jobs by 2015 to maintain the current rate of employed people to total population at 39%. Further the central Government Labour Ministry Report points out that 11 million people will join labour force every year from 2011-12.
Thus it is clear that the economy has miserably failed in generating good quality jobs in adequate quantity.
2. Poverty Reduction
Employment generation is the royal path for poverty reduction. The Government, having miserably failed to generate jobs in adequate numbers, has also failed in poverty reduction. In fact the Government is not even clear as to who are poor. The planning commission recently filed an affidavit before the supreme court stating that only those with an income of less than Rs26 per day in rural areas and Rs32 per day in urban areas, are considered as B.P.L. by the Government. This is ridiculous and the Chairman of the planning commission was severely castigated for his insensitivity towards the poor.
The Government also does not know clearly how many poor people are there in the country.
Different Poverty Estimates
Serial No. Poverty Estimates % of population
1. Planning Commission 28%
2. Suresh Tendulkar committee 37%
3. N.C.Sexena Committee 50%
4. Arjun Sengupta (N.C.E.U.S.) 78%
5. Human Development Report - 2010 55%
Thus there is total chaos in the Government with regard to the Definition of poverty and estimation of the B.P.L. population. Poverty reduction claims in the 20 years of globalisation is a farce.
Neglect of Agriculture & Farmers’ suicides
Agriculture sector which accounts for more than 60% of our population and which has the greatest concentration of poverty, has been deliberately neglected by the planning process in the last 20 years.
Investment in agriculture as a percentage of G.D.P.in the last 10 years has stuck around just 2% with the sole exception of 2008-09 when it marginally increased to 3.34% to fall again to 2.97% in the very next year.
The gross neglect of agriculture sector and opening of the country’s market for Agri-business MNCs, has resulted in large number of farmer suicides all over the country. According to National Crime Records Bureau’s latest report, between 1995-2010 (16 years) 2,56,913 farmers have committed suicide all over the country. However Maharashtra, Madhyapradesh + Chhattisgarh, Karnataka and Andhra – together account for 56% of farmer suicides. During the first 8 years – 1995-2002, 1,21,157 farmers (57.67%) committed suicide. On account of the callousness of the central and state governments in remedying the crisis, during the next 8 years – 2003-10, another 1,35,756 farmer suicides were registered. (65.14%) Even in the latest year – 2010, 15,964 farmer suicides took place. However the Approach paper to 12th plan is totally silent about farmers’ suicides. This reveals the commitment of the government for inclusive growth.
3. Improvement in the standard of living of the people
The U.N.D.P. measures economic development on the basis of long and healthy life, Literacy and material standard of living – attained by the people of a country. On the basis of these three attainments it calculates Human Development index and ranking. It gives a fairly accurate picture of the degree of Human Development achieved in a country.
The H.D.R. achieved by India in the last 5 years is revealing.
Year Total number of countries India’s Ranking
2005 177 127
2006 177 126
2007 177 128
2008 182 132
2009 182 134
2010 169 119
2011 187 134
From the above data one can clearly see the very low Human Development Rank that India has been getting year after year.
Countries which are nowhere near India’s G.D.P. are far above India in their Human Development Ranking. For instance in 2011 while India’s rank is 134 out of 187 countries Srilanka’s ranking is 97, Thailand 103, Indonesia 134 and Vietnam 128. All these countries are not only smaller in physical size compared to India but also they are nowhere near India’s G.D.P. It becomes clear from this, that high G.D.P. does not automatically translate into high Human Development. India is a classic case.
India is home to the world’s largest food insecure population with more than 200 million people facing hunger and ranks 66 out of 88 countries on the 2008 Global Hunger Index of International Food Policy Research Institute.
According to the UNICEF Report India accounts for 1/3 of the world’s malnourished children and the country’s rate of malnutrition is at 47%, the same as Ethiopia’s. What a great record for a country which boasts as the 12th richest country in the world and a Trillion dollar Economy!
4. Environmental Sustainability
Our record in environmental sustainability is no better. India is the 5th most polluting country in the world so for as Green House Gases Emission is concerned. It also has the dubious distinction of being the 4th largest petroleum consumer in the world. Our rate of river pollution, air pollution, plastic pollution and forest and wild life destruction are fast getting into crisis levels.
Conclusion
India has miserably failed in all the 4 parameters of growth that the Prime Minister Dr. Manamohan Singh has enunciated. He continues to harp on Inclusive growth where as India during the 20 years of globalisation has followed the most Exclusive Growth Path in which nearly 80% of the country’s population is excluded from the path of Development.
The approach paper to the 12th plan follows the same Exclusive Growth Model as the earlier 4 Five Year Plans. It is business as usual for the planning commission.
We demand the scrapping of this approach paper to 12th plan altogether and to rewrite it with a new vision of Swadeshi. The 12th five year plan must have the following priorities.
1) Employment Generation,
2) Poverty eradication through employment and not through doles,
3) Human Development centric and not G.D.P. centric growth,
4) Agriculture, Rural Industries and Rural Infrastructure,
5) Minimum Foreign Investment and maximum Domestic Investment,
6) Domestic Market but not Export centric Growth.
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Key note address presented at the National Seminar on The Draft Approach Paper of 12th Five Year Plan held at Tiruvananthapuram on 21st January 2012.
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