ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Growth Transitions in India

Growth has consistently remained a central topic in economic policy considerations of the government in India. However, there has also been a more scholarly interest in it among social scientists. As a part of the latter tradition, this paper addresses the proper delineation of the phases of growth in India, a matter of some discussion in the literature. Using state-of-the-art statistical methodology, it first establishes the trajectory of growth and then provides a theoretical explanation for that history. With data spanning the period 1950–2020, the procedure adopted is also able to assess the impact on economic growth of the policies of the present government. The results are conclusive. First, it is established that growth in India has accelerated continuously since the 1950s, implying that dynamism in the economy did not have to wait for the liberalising reforms launched in 1991. Next, the performance of India’s economy is compared to growth that has taken place in the rest of the world. It is seen that while India’s economy has, in recent years, shown a dynamism relative to the rest of the world, it has consistently fallen behind its most dynamic regions, notably in East Asia.

The Interstate Variation in Mortality from COVID-19 in India

While the response to COVID-19 by the Government of India has been more or less uniform across the country, in that a lockdown was imposed throughout, the death rate has varied across the states. This suggests that region-specific factors are likely to be relevant to the determination of this rate. A significant aspect of this study is the use of three different measures of the death rate in the empirical exercise. This showed all three measures of the death rate to be strongly related to health expenditure as a share of the gross domestic product but hardly at all to public health infrastructure. This can be interpreted as a sign of the role of the public health system—comprising medical personnel, infrastructure and protocols—in the prevention of death, with health expenditure as a key determinant of its effectiveness. It has an implication for public policy beyond the immediate health emergency due to COVID-19.

Unmoved by Stability

The electoral promise of transformational economic change had potentially played a role in the decisive victory of Narendra Modi, particularly in the 2014 general elections. In power, his government actively pursued macroeconomic stability and a business-friendly regulatory framework. However, the investment rate of the economy has actually slid, and has remained mostly at a level that is lower than what it was when the government assumed office in 2014. This outcome is interpreted as the result of the pursuit of macroeconomic stability, in the belief that it is conducive to growth, however it may be achieved.

Macroeconomics in The Economy

The Economy is a worthwhile initiative that seeks to teach students about the economy, as opposed to teaching economics. The macroeconomic aspects of the textbook are critically scrutinised to understand what is being taught, and how different the treatment is from extant approaches.

Markets, Growth and Social Opportunity

Since 1991, there has been an acceleration of economic growth accompanied by a widening of the range of consumer goods produced, together with improvement in the quality of services available. Furthermore, the economy has passed through the longest period since 1947 without facing balance-of-payments stress. However, not all sectors of the economy have shown the same dynamism, with the performance of agriculture actually becoming a cause for concern. The unequal distribution of social opportunity has meant that this shortcoming has left a significant section of the population in a low-income trap. What underlies this outcome is examined and what is needed to correct the imbalance is proposed.

Budget without Heft

Budget 2016-17 correctly recognises that the economy is facing a demand slowdown but fails to back this up with necessary expenditure to boost aggregate demand. Guided by its programme of fiscal consolidation, the government has almost frozen public investment in order to achieve the targeted deficit for 2016-17. While its proclamation to improve ordinary lives is welcome, a rearrangement of deep-rooted structures of public expenditure in India is required to achieve this.

'The Great Reversal'

With reference to my article “The Great Reversal: A Macro Story” (EPW, 24 May 2014), Rangeet Ghosh of the Office of the Chief Economic Adviser, Ministry of Finance, has pointed out that in the most recent version of the source cited by me for Table 4, the figures for public and private capital...

Kerala and the Rest of India

Kerala has shown that it is possible to improve the quality of life of a people even at low levels of per capita income through efficient provisioning of public services in health and education. At the national level there has been a dramatic alteration of production possibilities achieved by intelligent public policy intervention supported by determined resource mobilisation. We now see that what is needed across India's states is a greater synergy between these two approaches.

The Great Reversal

Adverse supply shocks in agriculture have contributed to the slowdown of the Indian economy and the inflation surge. A decline in public capital formation has also played a part in the slowdown. However, the contribution of the widening fiscal deficit is less clear-cut. A revival of growth calls for an easing of the constraints in the farm sector and larger public investment outlays, accompanied by higher public savings.

Goods and Power in the Progress of Nations

An Uncertain Glory: India and Its Contradictions by Jean Dreze and Amartya Sen (England and New York: Allen Lane, Penguin Group), 2013; pp xiii + 433 , £20.

A House for the Social Sciences

For the first time since the creation of the Indian Council of Social Science Research in the 1970s, the Government of India set up, in 2010, a committee to review the functioning of the council. The four articles in this special section, three of them by directors of ICSSR institutes, discuss different aspects of the report of the committee. The first article commends the quality of analysis and the recommendation to correct the current niggardly government financing of the ICSSR but asks why there has been no discussion of the quality of research and accountability in the social science institutes.

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