Some of India’s achievements in the past 50 years have been remarkable. To the amazement of many, this vast and complex society has managed to protect national unity, introduce and preserve democracy and dilute traditional hierarchies. But economic progress has been disappointing. Despite the rhetoric of socialism and the pervasive state intervention in its name, poverty continues on a colossal scale. More than one third of India’s one billion people live in conditions of acute poverty; and more than one third of the world’s poor are concentrated in India. The goal of the next 50 years must be to achieve widely-shared prosperity without sacrificing democracy and civil liberties: the economic reforms initiated in 1991 constitute a beginning, but a long road lies ahead.
Redistribution alone cannot eliminate poverty. For the next two or three decades India needs a sustained increase in the growth rate of national income from the erstwhile ?Hindu rate? of 3.5 per cent per year?and even the rate of 6 per cent achieved since its recent reforms began?to 8 per cent or more. But fast growth is not enough either. If the poor are to benefit, growth should be labour-demanding, not labour-displacing. India?s population increase is finally slowing: from 2.2 per cent per year in the 1970s it has come down to 1.7 per cent and will probably fall further. Even so, for some time India?s labour force will continue to grow nearly as rapidly as before.
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