A new economic architecture for Kerala

C Sarat Chandran | Updated on June 08, 2020

The State can emerge as a major source for high quality healthcare professionals for the world

Kerala’s painstaking efforts in meeting the challenge of the corona crisis has won wide appreciation across India and beyond. Right from the time the first signs of the virus were detected in the central city of Wuhan in China and three students from Kerala were forced to return home in late January, Kerala was on high alert, mobilising its resources and with a carefully prepared protocol that was effectively implemented.

There is, however, more to Kerala’s response than this high degree of preparedness. Kerala has often received global attention and admiration for its model of development with its prime focus on education, healthcare, environment and cleanliness. Kerala also ranks first among all Indian States in the Sustainable Development Index constructed by NITIAayog, and which aligns with the United Nation’s Sustainable Development Goals.

Social development

It is important to note that while all other States were primarily concerned with a higher degree of economic growth and industrial development, Kerala reversed the trend by laying a strong foundation of social development on which the State could build a super-structure of inclusive growth. The result has been that the State’s economic growth has been trickling down to socially and economically disadvantaged sections in greater measure than what happens in the rest of India.

Kerala also enjoys a unique resource in terms of its 2.5 million strong diaspora spread across the globe. In a world that is getting increasingly integrated, Kerala has a luminous history of interactions with the world outside. The diaspora has been adding great value to Kerala’s economy by massive remittances and the Sate has often been described as a “money order economy”.

In 2018, the State received $20 billion from Keralites working abroad, mostly in the Gulf region. This is equivalent to around ₹1,40,000 crore and forms 25 per cent of all the remittances India received in 2018 from the NRI community across the world. This huge wealth creation should be seen as a reflection of the quality of Kerala’s human resources, whether they are the workers in the Gulf region, the nurses in the hospitals across the world or teachers employed in schools in Africa.

Former President Abdul Kalam addressing the Kerala Assembly in July 2005 observed: that “What distinguishes the Kerala workers is not only their capacity for hard work, but also their creativity and spirit of innovation.” President Kalam also colourfully described the nursing community from Kerala as ‘God’s Own Girls’. It is the same commitment and spirit of service that was displayed by the State’s healthcare professionals on the frontline in the fight against the spread of Covid-19. It is not only the doctors and nurses, but the entire healthcare community including the sanitary workers, the ambulance drivers and the security staff, who have joined this massive human mission.


They didn't stop there. Drawing strengths from the current momentum, the State seems to be discovering itself with its economy steadily evolving into a new architecture within a triangle of “global connectivity, high performing human resources and a range of socially focused services.” Two major transformations underpinning the global economy have strengthened the process.

First is a shift from manufacturing to services as a major driver of economic growth and the second is an equally important shift from physical resources to human resources in defining the idea of ‘wealth’. These two shifts have important implications for the Kerala economy. The share of services in the national income has been steadily increasing as a worldwide phenomenon and this is particularly noticeable in India.

That brings us to the central question. What kind of services can create such massive employment opportunities? On top of the list must indeed be, healthcare. What information technology is to India as a whole, healthcare must be to Kerala. Healthcare has now emerged as the largest industry in the world, pushing tourism to the second place.

Today, it is the industry that is beating the recession and is growing at a healthy annual rate of 6 per cent. The world today is also woefully short of a range of healthcare professionals, from nurses to laboratory technicians to physiotherapists and pharmacists. With an imaginative set of policies backed by concrete action, Kerala can emerge as one of the world’s biggest sources of high quality healthcare professionals as much as India has become the source for IT professionals.

What is often not recognised is the fact that healthcare is much more than technology. It is essentially an approach to human care and Kerala nurses have earned a legendary reputation and brand equity in this profession.

In June 2018, Lini Puthussery, a young nurse working in a government hospital in Perambra, a small town in Kerala, became a casualty to the Nipah infection. The Economist magazine featured Lini in a special obituary and concluded with a powerful observation: “If Vasco Da Gama returns to Kerala after 520 years, what he will be looking for will not be the region’s famed spices, but its high quality human resources!”

Training institutions

This is an opportunity for Kerala. What Kerala needs to do is to establish world class training institutions with state-of-the-art facilities, organisational back-up and international accreditation. An Australian hospital chain has already come forward with a proposal to set up a facility in the State and offer training to over 10,000 nursing professionals with job guarantee to all of them. The group is now looking for a partner with knowledge and experience of local environment and government regulations.

Fortunately, Kerala’s traditional healthcare practices are now receiving a level of international acceptance with “age care” emerging as an area of concern and where the world is discovering the value of ayurveda. What is required is a convergence of our traditional strengths in nursing, ayurveda and physiotherapy to evolve an entirely new approach to healthcare that the world is waiting to welcome.

Once the primacy of services in economic growth is recognised, a range of possibilities unfold themselves. What is not often adequately understood is the fact that what the world lacks today is not goods and merchandise as such but the range of skills to produce them. While it will take, perhaps, a couple of years at the most to manufacture even the most complex product, it should take a minimum of 10-15 years to create a skilled workman.

Fortunately, Kerala has an abundance of skills that the world needs today. Thousands of Keralites have practical experience and international exposure and what our planners need to do is to create an exhaustive “skill bank” of these talents and make the data available to any country that may want to use them.

The coronavirus crisis has brought to the fore Kerala’s remarkable strength and capability in one such sector — healthcare.

The writer is a Senior Fellow of the London School of Economics and a former Director of the Indo-Australian Chamber of Commerce

Published on June 08, 2020

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

This article is closed for comments.
Please Email the Editor