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Job Creation and
Poverty Reduction in India: Towards Rapid and Sustained Growth
The book is a compilation of articles related to development and joblessness and the measures that could be taken to improve the situation. Sadiq Ahmed is the Sector Director of Poverty Reduction, Economic Management, Finance and Private Sector, South Asia Region, World Bank. When someone in a position that he is makes a statement, it is definitely worth reflecting upon. This book has articles written by distinguished economists and researcher analysts who are authorities in their own right. It tracks India’s economic experiences through phases of rapid growth and also deterioration. It has been meticulously divided into four parts—Setting the Scene, Macroeconomic Framework for Sustained Growth, Sectoral Policies for Growth and Labour Market Policies for Job Creation. In Setting the Scene, Sadiq Ahmed examines the shift of India from the ridiculously low growth rate of about 3 per cent to more than 6 per cent. He delves into the factors that probably led to this rise and also discusses the policies that would encourage positive economic performance. He theorises that if the current rate of growth is sustained, India could become the second fastest growing economy after China. The article deals with the fact that all sectors have benefited to a greatly varying degree due to growth. Also, there has been disparity in the growth of different states with the rich states becoming richer and benefiting more from the government policies. He suggests ways to achieve more labour intensive methods of growth so that employment could be provided to the maximum number of people and the labour potential of our country could be fully exploited. The government’s liberalisation policies have brought about a spurt in growth and it is imperative that the long-term reforms continue to their next stages. Railways, roadways, electricity, telecommunication, education and electricity are some of the sectors that are in dire need of improvement. Brian Pinto, Farah Zahir and Gaboo Pang discuss the shift of focus from crisis and stunted growth to faster growth in the Fiscal Policy for Growth in India. They discuss the fiscal space and show that it can be drawn upon to achieve long-term growth while helping government solvency. They also recommend analysing the factors that favoured India when all the other emerging market countries were facing crisis and India was comparatively better able to deal with it. Among other things they compare India with China and conclude that the cost of most infrastructure services is 50-100 per cent higher in India than in China. Deepak K. Mishra sheds light on the shift that brought about a change from the licence raj mindset to the empowering of private sector via liberalisation. He documents the policy changes regarding industrial licensing, foreign trade and investment policies and labour and land market policies. He segregates periods on the basis of the degree of restrictedness and examines them. Priya Basu considers growth as a function of financial sector and dependent on changes in this sector for improvement. Dina Umali-Deininger stresses the need to focus on agricultural development to achieve national growth. She notes that although only about a quarter of GDP comes from agriculture, our economy is largely based on it. She suggests changes in regulations related to electricity, land, water and other basic demands of agriculture to bring about any effective change in its present condition. Ahmad Ahsan and Ashish Narain remark that although India has become the fourth largest economy in the world in terms of purchasing power, poverty reduction has not been significantly achieved. According to them, empowering the skilled and non-skilled labour, bringing about reforms in policies governing them, their wages and their working conditions would help change the scene. Tables and graphs nicely support the articles. Wherever there is need the text has been supplemented with notes and references as well. It is a well-researched piece that has been written by people who command a lot of authority in their fields.
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The
money makes the world go round, and there are umpteen numbers of forces
at work that make the money go round. Managing and juggling these
interrelated aspects and fine-tuning them to get a country at par or
above the other economies of the world is a great responsibility for any
government. If the government ascertains that everyone is capable enough
by way of ensuring education and infrastructure, unemployment could be
greatly curbed.