It may not surprise many that some states in North India which suffer from relatively high illiteracy, high population growth rates and poor income generation have notched brisk growth rates. Bihar, Rajasthan and Madhya Pradesh have logged an average of 9.4% growth since 2006-07 which is above the national average. Redistributive programmes launched by the government took time to make an impact. The growth rates of these states went up before that was done. The distance between the best performing and worst performing districts in these states diminished in the last decade. Such growth has reduced income inequality between the regions. If the UPA government have woken up to this reality earlier, there would have been a radical shift in its political and economic structure. The government has now placed renewed emphasis on growth as the best indicator of the economy’s performance. Manmohan Singh highlighted the fact at the National Development Council. Such a commitment will be in the interest of the poor.
The government acknowledges that an 8% rate of growth as targeted in the 12th Five Year Plan is going to be difficult to achieve. In the first two years of the plan India is expected to register about 6% growth each year. The economy will have to move ahead at 9% for the three remaining years. That will be a lot better than the 7.9% growth in the 11th Plan. The 12th Five Year Plan will have general elections in the middle and the scope for corrections and initiatives will be limited. The watchword will be speedy measures for development.
