An Uncertain Glory

2024-11-09

A note: The first edition of the book was published in 2013 and second edition in July 2019.

Notes

Though economic growth in India has picked up over time, the pace of improvement of living conditions remains very slow. One reflection of this is India's poor social indicators compared with China and its other south Asian neighbors like Bangladesh and Nepal which are much poorer than India in terms of per-capita GDP.

The lethargy in social policy in India is further exacerbated be the dearth of social statistics. For instance, when the book was written in 2013, we were constrained to rely on the third National Family Health Survey (NFHS-3) carried out in 2005-6. In Bangladesh, by contrast, the Demographic and Health Survey has happened at regular intervals of three years or so since 1990's. At the time of writing (July 2019), very few reliable social indicators are available beyond 2016.

Well-functioning public services in fields like health and education are critical for fostering participatory growth as well as in ensuring that growth leads to rapid improvements in people's living conditions. Indian states such as Kerala, Himachal Pradesh and Tamil Nadu have done reasonably well in this respect but the general state of public service in India remains absolutely dismal and the country's health and education system in particular are messed up. While the privileged are able to take refugee in private institutions, the rest are deprived of essential facilities that ought to be available as a matter of right.

Even though India has significantly caught up with China in terms of GDP growth, its progress has been much slower than China's in indicators such as longevity, literacy, child nourishment and maternal mortality. In South Asia itself, the much poorer economy of Bangladesh has caught up with and overtaken India in terms of many social indicators like life expectancy, immunization of children, infant mortality, child nourishment and girls schooling. Twenty years ago India has the second-best social indicators among six south Asian countries (India, Pakistan, Bangladesh, Sri Lanka, Nepal, Bhutan), it now looks second worst (only ahead of Pakistan).

Many of these social problems can be dealt with by institutional reforms but there is also a need for change in behavioral norms to eliminate the acceptability of corrupt practices.

For several decades after independence, Indian economy growth was quite slow - 3.5 percent annually. This lasted from 1950's to 1970's. In the 1980's, the growth rate increased to 5 percent annually. And followed by economic reforms of the early 1990s, the economy settled down to faster progress of more than 7 per cent annually. Despite this rapid growth in recent years, hundred of millions continue to lack essential requirements for satisfactory living, from nutritious food to health care, decent work conditions, and warm clothes in the winter.

What went wrong with the First Five Year Plan and other early economic planning? They failed more completely in terms of social infrastructure and tertiary industries than it did in the fields of primary and secondary production.

In the recent decades of rapid growth, the living standards of the middle class (the top 20 percent of the population) have improved well beyond what was expected. But the story is more complex for many others like the rickshaw puller, domestic worker or brick-kiln laborer. According to National Sample Survey data, average per capita expenditure in rural area rose at the exceedingly low rate of 1 per cent per year between 1993-4 and 2009-10 and even in urban area, the average per capita expenditure grew at only 2 per cent during this period. There has also been a major slowdown in the growth of real agricultural wages: from about 5 per cent per year in the 1980's to 2 per cent or so in the 1990s ad virtually 0 in early 2000s. It is only after 2006, when the National Rural Employment Guarantee Act (NREGA) came into force that growth of real agricultural wages picked up again.

In contrast with China, according to comparable international data from the International Labor Organization, real wages in manufacturing in China grew at 12 per cent per year or so in the first decade of this century compared with 2.5 per cent per year in India.

The good deal of growth in services has been concentrated in skill-intensive sector (such as software development, financial services) rather than more traditional labor-intensive sectors. This has enabled the more educated section of the labour force to earn much higher wages. For the bulk of the labour force marooned in agriculture and the informal sector (about 90 percent of India's total workforce), wages and productivity tend to remain very low. It may be less glamorous to make simple pocket knives and reliable alarm clocks than to design computer programs but the former gives the Chinese poor a source of income that the latter does not provide.

Two major problems face the Indian economy:

• removing the sharp disparities that divide the country into the privileged and the rest while continuing to encourage economic growth.
• bringing more accountability to the running of the economy, particularly in delivery of public services and operation of public sector.

If development is about enhancing human freedoms and quality of life, then the quality of environment is bound to be part of what we want to preserve and promote. Caring about environment need not undermine the commitment to development and the removal of poverty and deprivation. The crucial ingredients of our quality of life are thoroughly dependent on the integrity of the environment involving the air we breathe, water we drink and epidemiological surroundings in which we live.

The minority of people who has been prospering well enough in India is large in absolute numbers, though estimates of the size of this minority vary - they certainly for exceed 100 million or so. Yet in the statistics involving more than 1.2 billion people, the fortunate group is still too small to swing the average figures for Indian population as a whole in terms of most social indicators.

India's per capita income is 60 per center higher than Bangladesh in 1990 and in 2011, it was estimated to be double that of Bangladesh in 2011. But during the same period, Bangladesh overtook India in a wide range of social indicators like life expectancy, child survival, enhanced immunization, reduced fertility rates and some schooling indicators.

One of the important factor in Bangladesh's development is women's agency. For instance, both female literacy rate and women's participation in workforce played an important role in demographic transition (from high to low mortality and decrease in fertility rates). Women's participation in the workforce in is almost as twice as high in Bangladesh than in India (57 percent and 29 per cent respectively).

Gender indicator in India and Bangladesh:

Other social indicators comparison between India and Bangladesh:

India within itself is very diverse. Some states like Tamil Nadu and Kerala would be at the top of the South Asian comparison if they were treated as separate countries and some others - Uttar Pradesh and Madhya Pradesh - would do enormously worse. Indian states which have done well had solid foundation of participatory development and social support early on and actively promoted expansion of human capabilities in terms of education and health. The living condition in the poorer half of India are not much better than in the poorer half of Africa.

Throughout the 1970's and 1980s, official poverty estimates for Tamil Nadu were higher than corresponding all-India figures. During this period, the state initiated bold social program's like mid-day meal schemes and started putting in place extensive social infrastructure - schools, health centers, roads, public transport, water supply, electricity connections and much more, resulting in better social indicators..

The public revenue generated has not been well utilized to improve the social infrastructure of the country.

The media says about Indians grabbing great jobs in the Western world and at the same time, there is an India which has a lack of proper access to toilets, healthcare and other basic provisions to lead a life with dignity. Why? India is a microcosm of different cultures. Though the relatively affluent form a small proportion of the population, the absolute numbers is large.

In the media, there is a lack of discussion on the problems of the poor. The media discusses the problems of the middle-class and the middle-class of the media are the poor among the rich. This can be attributed to the fact that the poor in the rich are the category of people who consume the information form the media.

In July 2012, there was a power blackout plunging half the country into darkness. About a third of the population (around 400 million people) are not even connected to any electricity supply. Why is the power sector so inefficient? The two confounding questions about India's public sector are:

• In what areas can the public sector, given feasibly good arrangements, serve the interests of the public better than the private sector?
• How can public sector be made accountable, so that they serve well?

The Chinese score higher in running a more efficient state-led power sector. For instance, China has invested more than twice as much as a proportion of GDP on the power sector than has India. China has built capacity in generation power in a way India has not. They also generate a significant return on their investment in the power whereas the Indian power sector is perpetually deficit. This is a problem of accountability. The guardians of Indian power strategy face little pressure to get things right and are not asked to take responsibility for the terrible state of power planning in India. A related reason for limited reach and capacity of the Indian power sector is the practice of tolerating huge losses accrued by state led power utilities, which arise to a great extent from badly reasoned electricity subsidies, poor collection of electricity charges, power theft, transmission losses and other costs. Subsidizing power consumption for relatively better-off consumers is money which could haven been utilized to help the expansion of education for the unschooled and provide health care for the medically deprived. Stopping the drain and face the pressure groups are hard political tasks and unless Indians - government servants, politicians, people at large - rise to this challenge and are made more accountable, Indian power sector will continue to fail.

The issue of accountability relates closely to that of corruption. Corruption is fostered and nurtured by the absence of systems of accountability. Any system that leaves government officers effectively in sole command over giving licenses without checks and invigilation can become a minefield of corrupt practices. The trio of informational lacuna, social leniency and prosecutional difficulty are among the factors that sustain a culture of corruption.

One of the biggest obstacle to restoring accountability is the hugely pessimistic view that nothing can change. But change is possible. There is no single magical bullet which can bring in accountability but it can be done via a combination of moves that include reforming the administrative system via legislative and institutional changes can make a big difference like the Right to Information Act of 2005 which is a major step toward greater transparency and accessibility of information, changing incentive structures, reducing social tolerance of financial dishonesty etc. Technology can be used to prevent corruption as well as dereliction of duty, like computerizing the Public Distribution System to reduce embezzlement.

Japan gave education a central role in its national program. Their Fundamental Code of Education issued in 1872 expressed a public commitment to make sure that no community with an illiterate family nor a family with an illiterate person. The role of basic education in the process of development and social progress is very wide and critically important. The ability to read, write and count has powerful effects on our quality of life. Our economic opportunities and employment prospects depend greatly on our educational achievements and cultivated skills. Illiteracy muffles people and their voices, contributing to their insecurity. Basic health education can also play a major role in tackling health problems and public health in particular.

A large portion of the population lacks access to good public education system. Education is increasingly being privatized making it unaffordable to the large amount of population. About 20 per cent of Indian children between the ages of 6 and 14 years were not attending schools. Surveys on school finds that only two-thirds of the pupils were present on the day of the survey with a teacher absenteeism rate of 20 per cent as well.

School education in India suffers from two main issues: limitation of coverage and poor standards of education that is offered and received. In the PISA Plus education survey of 2009 in which the two better-schooled states, Tamil Nadu and Himachal Pradesh participated, Indian states figured among the bottom three.

A classic problem of school education in India is under funding by states. But recent Pay Commission's have significantly boosted the salaries of teachers. For example, in 2001 the ratio of teacher salary to GDP per head in China was around one, somewhere between one and two in most OECD countries but in India, it was higher than three. It appears there is little evidence to suggest that high salaries are helpful in raising teaching standards. The high salary of teachers increases the social distance between teachers and parents, especially in rural areas which does not help in fostering a mutual cooperation between parents and teachers.

The country has an odd system of Pay Commission that recommends salary scales for public employees without offering any enlightenment on how the financial burden of the wages could be financed and what implications would be on the lives of people whose wages are not determined by the Pay Commission.

The problems with public schools results in privatization of education system. But private schools have a major problem of affordability for the poor families and disadvantages communities. In the absence of competition in rural areas, private schools are extractive money-making machines. A greater reliance on private schools takes away from state school the children of those parents who are likely to contribute most to the critique and demands that could make state schools accountable.

China devotes 2.7 per cent of its GDP to government expenditure on health care compared with India's relatively miserable 1.2 per cent is directly relevant to much greater health achievements of China compared with India, for instance its much higher life expectancy (about eight years higher than India's).

A study of health services revealed in Udaipur district (Rajasthan) reveals that more than half of health centers were found to be closed during regular opening hours and in Primary Health Centers, 36 per cent of the personnel were absent on the average.

India has moved towards reliance on private health care without developing the solid rock of supporting basic public health facilities that has been the basis of almost every successful health transition in the history of the world - form Britain to Japan, from China to Brazil.

Fraud, over-medication, exploitative pricing and unnecessary surgery seems to be quite common in private health sector. For example, a study in Chennai found that 47 per cent deliveries in private sector end up with a Cesarean against the WHO norms of up to 15 per cent.

The government has under taken national health insurance schemes where government pays the insurance premium and the family can take up treatment in the private health care institution of their choice. A health system based on commercial health insurance is likely to be biased against preventive health services and non-hospitalized care. It also results in selection issue where the insurance is likely to attract people prone to illness, there by raising insurance premiums or insurance companies protecting themselves by screening their clients, which runs against basic principles of equity in health care. In the case of insured patients, health care providers have little incentives to contain the costs and thus health insurance raises complex efficiency issues. A targeted health care system where the government provides insurance to a subsection of the population causes issues like exclusion errors associated with the targeting process.

To solve the health care crisis in India, an universal coverage for all in a comprehensive vision of health care is required. Instead of expensive schemes like national health insurance schemes, as far as public health is concerned, a renewed focus on primary health centers, village level health workers, preventive health measures like immunization, sanitation, public hygiene, waste disposal, disease surveillance, vector control, health education, food safety regulation and so on are required. Well-planned effort to improve public facilities can lead to significant results.

Targeting as a social policy to focus public resources has serious problems in a country like India. First, there are exclusion errors. Identifying the Below Poverty Line (BPL) households is extremely difficult and involves large exclusion and inclusion errors. Thus, public program's on the alternative principle of universalism with self-selection have done comparatively well. One example is India's school meal program where all children studying in government or government-aided schools are entitled to a nutritious midday mean free of cost. Another example is the National Rural Employment Guarantee Act. According to official data, about 50 million households have participated in the NREGA every year since 2008-09.

India has a unique cocktail of three different forms of inequality - rich-poor, caste, gender based. The mutual reinforcement of severe inequalities of different kinds creates an extremely oppressive social system, where those at the bottom face extreme disempowerment.

At the first glance, India is the first non-Western country to have a democratic way of governance, with systematic multi-party elections, subordination of military to the civilian government, independence of judiciary and freedom of speech. But looking beyond these achievements, the massive continuation of different kind of inequalities in India provide strong evidence against considering Indian democracy to be a success.

Democracy is the exercise of public reason. When citizens deliberate, they exchange views and debate their supporting reasons concerning public political questions. Thus, public discussion with equal participation is a key aspect of a democracy.

Reasoning with others involves presenting one's point of view and paying serious attention to the points of view of others. This can be done via media or through public meetings. But when is it hard to get a good hearing, agitation, demonstration and campaign can indeed be a part of public reasoning.

What tends to limit the adequate discussion of critically important problems of deprivation and inequality that continue to be neglected in India? The biggest barrier to the free operation of the media lies in its partiality in favor of the rich and the powerful with a serious lack of interest in the lives of the Indian poor. The economic dependence of the media on advertising creates a special focus on potential customers as a result of which the rich count more than the poor.

The shared interest of the privileges people, which includes the relatively affluent including the educated class dominates policy discussions and as a consequence, also governs what happens in the country.

For a large part of Indian population - a relatively small minority but large in absolute numbers, economic growth does fine as they are already comparatively privileged. But for the vast majority, particularly those who are prevented by seizing the economic opportunities by ill health, lack of schooling, social barriers, public support is extremely important to lead a life without hunger, poverty, illness and other deprivations.

The basic facilities of a usable school, an accessible hospital, a toilet at home or two square meals a day are missing for a huge proportion of the Indian population in a way they are not in say China. To give an example about lack of basic facilities, in 2011, half of all Indian households did not have access to toilets, forcing them to restore to open defecation compared with less than 10 per cent of household lacking this facility in Bangladesh and only 1 per cent or so in China.