The Hindu Business Line : Rural India not shining at all: Economist

According to Prof S. Mahendra Dev, Director of the Centre for Economic Social Studies (CESS), rural India is not shining because the agricultural growth showed only 1.8 per cent per annum in the Ninth Plan period (1997-2002). Growth rates in food grains and all crops declined significantly in the 1990s. Similarly, public investment in agriculture and credit-deposit ratios in rural areas declined during the last decade.

This apart, Prof Dev pointed out that employment growth was much lower in the 1990s as compared to that of 1980s. Growth in agricultural employment was almost zero. Even in industry and services, employment growth is low. Agriculture wage data shows that the rate of growth of agricultural wages declined from five per cent in the 80s to 2.5 per cent in the 90s.

Referring to the recent statement of the Planning Commission that 84 lakh employment opportunities were created on an average during 2000-02, the CESS Director said that some other estimates showed that the "numbers were exaggerated". Moreover, there was absolute decline in the number for rural youth and youth among women.

The increase in migration from rural to urban areas during the reform period, the growing incidents of farmers' suicides and the widening rural and urban disparities also demonstrate that rural India is not shining.

Certain other happenings in rural India also show that it is not shining. For instance, in most schools teachers were absent or proxy teachers engaged on very low wages were conducting teaching.

In a paper presented at a recent seminar on `Globalisation-Rural transformation' at the Kakatiya University, Warangal, Prof Dev said in 2002-03, the growth of Gross Domestic Product (GDP) was only 4 per cent. The euphoria about "India shining" got intensified with the expected growth of 8 per cent in 2003-04. But, even if we take 8 per cent growth of 2003-04, the GDP growth during 1997-98 to 2003-04 would not be higher than that of around 5.8 per cent registered during the Eighth Plan. The higher growth in 2003-04 was due to revival of monsoons and low base of last year.

While the growth in agriculture GDP declined from 3.4 per cent in the 80s to three per cent in 90s and 1.8 per cent in the Ninth Plan period, the industrial GDP declined from seven per cent in 80s to 5.8 per cent in 90s and to 4.5 per cent in the Ninth Plan period.

The only "shining" element is in the service sector where the GDP increased from 6.9 per cent in 80s to 7.6 per cent in 90 and to 8.1 per cent in the Ninth Plan period. However, Prof Dev says, the increase in growth of services during the Ninth Plan period could be partly due to increase in salaries in the late 90s.

After assessing that rural India was not "shining" in the post-liberalisation period, Prof Dev suggested eight areas where policy attention was needed for making rural India to shine.

These areas were public investment in rural infrastructure, agriculture, water management, rural non-farm sector, employment and wages, health and education, regional and personal disparities, decentralisation and governance. As per Prof Dev, rural investment, rural technology, rural institutions and rural employment schemes were needed for rural transformation.

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