Widening economic & social disparities: Implications for India

India is often characterized as an emerging economic super power. The huge demographic dividend, the high quality engineering and management talent, the powerful Indian diaspora and the emerging Indian transnational--kneeling the optimism. In contrast, there is another profile of India which is rather gloomy. This is the country with the largest number of the poor, illiterates and unemployed in the world. High infant mortality, morbidity and widespread anaemia among women and children continue.

India suffers from acute economic and social disparities. This article addresses four dimensions of such disparities, viz. regional, rural-urban, social, and gender. There is empirical evidence to indicate that during the last two decades all these disparities have been increasing.

As a result of economic reforms, the southern and western States experienced accelerated economic and social development as compared to northern and eastern States. This has led to widening gap in income, poverty and other indicators of development between the two regions. Rural-urban divide also widened in the wake of reforms. While large and medium cities experience unprecedented economic prosperity, the rural areas experience economic stagnation. As a result, there is widespread agrarian distress which results in farmers’ suicide and rural unrest.

Socially backward sections, especially scheduled castes and tribes (SCs and STs) have gained little from the new prosperity which rewards disproportionately those with assets, skills and higher education. STs have often been victims of development as a result of displacement. The gender gap in social and economic status, traditionally more in India as compared to other societies; has further widened by the economic reforms and globalization.

The approach paper to the Eleventh Plan stresses the importance of more inclusive economic growth. It emphasizes the need for bridging the divides discussed in this article. Unless these are achieved in a time-bound manner, there could be serious adverse implications for the Indian economy, society and politics.