Financial Daily from THE HINDU group of publications
Monday, Jan 12, 2004

Cross Currency

Group Sites

Industry & Economy - Economy

Reforms help in poverty reduction: Unctad study

Our Bureau

"Contrary to the perception of services sector providing employment only for the highly skilled, nearly two-thirds of the employment in the sector might benefit low-skilled or medium-skilled people."

New Delhi , Jan. 11

A NEW study by the UN Conference on Trade and Development (Unctad) team in India reveals that Maharashtra, Tamil Nadu, Gujarat, Karnataka, Andhra Pradesh and Punjab are better integrated into the global process as evidenced from their growing share in the country's total exports. They have also witnessed the highest reduction in poverty rates, both urban and rural.

In the case of agriculture, domestic reforms would have a greater impact on rural poverty than external sector reforms even as a rise in world agricultural prices on account of liberalisation of world trade would substantially reduce the incidence of poverty globally. The poverty reduction gains would be especially significant for India where the majority of the poor live in rural areas, it says.

In the ongoing agricultural negotiations in the WTO, the Unctad study notes, developing countries such as India would stand to gain immensely if agricultural protectionist and trade distorting measures in developed countries are immediately addressed.

An interesting point brought out is that contrary to the perception of services providing employment only for the highly skilled, nearly two-thirds of the employment in the services sector might consist of low-skilled or medium-skilled people.For instance, it said, a major proportion of telecom investment in developing countries including India is directed towards building wire lines and mobile networks. There is also appreciable involvement of less skilled labour in the telecom and construction sectors, it notes.

The study is also categorical that most of the poverty gains from trade liberalisation would result from India's own reforms. Describing the advent of G-20 coalition pre-Cancun as an important opportunity for India to follow a trade reform agenda, it says increases trade among these countries would enhance the levels of incomes and employment and have both direct and indirect effects on poverty alleviation in India. "What India has to examine and weigh is whether the G-20 can also successfully deliver on its other market access requirement such as Mode-4 (movement of natural persons as service providers), textiles and other non-agricultural sectors," the study says.

The Unctad team in India's study was discussed at a workshop on impact of trade reforms on the Indian informal economy and poverty macro and case study analyses, organised by the National Council of Applied Economic Research (NCAER) and Unctad for two days here.

In her presentation, Prof Barbara Harriss-White of the Oxford University stated that far from being temporary, the informal sector in India had persisted over time and was dynamic.

She presented the findings of two joint studies — on garments in Tripur and rice in Punjab and West Bengal, which Oxford University had carried out with NCAER. She maintained evidence from field study pertaining to the informal economy suggested that formal and informal goods were hard to distinguish and that plurality of technologies coexists in the informal sector including textiles and garment.

Dr. Veena Jha, Coordinator, Unctad India Programme, said studies showed that traditional approaches such as global or universal free trade might not be optimum for poverty alleviation and that differential liberalisation could yield maximum poverty benefit for India.

More Stories on : Economy

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Experts for studying Low Level Jetstream

Expert call to harness alternative energy sources
Advani to open auto expo
Vajpayee upbeat on growth pace
More reforms, manufacturing top BJP agenda
`India doing well; recovery must be broad-based'
Reforms help in poverty reduction: Unctad study
Stress on need for after-sales service
Call for better infrastructure, more manufacturing units in coastal Karnataka
Investments in coastal Karnataka
`Immunisation must include triple antigen'
Advancements in hip surgical procedures
Arbitration forum for PSU rows
PTC to float public offer soon
Free saree/dhoti scheme keeps powerlooms busy in TN
Duty relief to benefit textile sector upgrade
More scope for SSI growth in Karnataka
BIS clamps down on bottled water plants; cos contest charge
SRM college sets up global advisory board
MBA programme
Budget for minorities hiked in AP
National Youth Day fete in Thiruvananthapuram
In Hyderabad today
Get the basics right
Exporters can file duty rebate claims at Commissionerates
`Diversion' of sugar to domestic market — Maharashtra told to take action against defaulting exporters
Guidelines for libraries
Racketeer in police net

The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |

Copyright 2004, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line