The fraying Gujarat model – Business Line–21.03.2018

NITI Aayog Vice-Chairman Rajiv Kumar during a visit to Gujarat recently observed that though the State’s performance on industry and infrastructure is to be lauded, it lagged behind in social development, especially education and health. He, however, expressed satisfaction over the State’s increased allocation on these crucial social sectors.
Now this is a significant observation from the head of the Government’s most important economic think-tank. Is this finally an admission from the powers-that-be that the much-touted Gujarat model of development crucially ignored social development? Will Kumar’s remarks lead to introspection by those who have been relentlessly tom-toming the virtues of this model?
Though Gujarat’s growth rate and per capita are among the highest, there is now near unanimity among economists that its social indicators are poor. This has now been validated by the NITI Aayog.
This clearly shows that the high growth in the State has not trickled down to the poor. As economist Indira Hirway argues, though the State government, especially during Narendra Modi’s stint as chief minister, went out of its way to attract investments, doling out massive sops by way of cheap land, power and tax breaks, it hasn’t led to significant employment generation thanks to the capital-intensive nature of industrialisation.
She also argues that the huge incentives handed out to industry have left the State with little funds for the social sector. Gujarat spends less than 2 per cent on education against an average norm of 5-6 per cent and 0.8 per cent on health against the norm of 4-6 per cent, says Hirway.
She says 45 per cent of the children there are undernourished and the decline in maternal mortality rate has slowed down. It’s not surprising then that the bureaucrats in the State are being asked to focus on child malnutrition and maternal mortality.
So will the BJP government in Gujarat swallow its pride and learn a few lessons from the Left Front government in Kerala on social development?

via The fraying Gujarat model – Business Line

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