Inequality in India

1
Inequality in India

• Naresh C. Saxena
• December 2008

2
2
3
Dimensions of rising inequality

• Regional
• Urban-rural
• Social
• Gender

4
Indias social complexity

• Is there consensus on policies pertaining to
  minorities?
• as defined by
• Language
• Caste
• Gender
• Religion

5
Legitimacy of ethnic group solidarity and politics

• Regional and linguistic Highest
• Scheduled Tribes
• Women
• Scheduled Castes
• Backward Castes
• Muslims Lowest

6
Legitimacy of Indian minorities
7
(No Transcript)
8
Long Way to Go

• North and East lag way behind in
• Health
• Education
• Poverty

Source District Level Socio-economic
Development, India Today State of the States,
2004.
9
(No Transcript)
10
Child Sex Ratio 2001 (by district)
10
11
Index number of Agricultural Production

• Index
  annual rate of growth
• 1981-82 100
• 
  4.4
• 1990-91 148
• 
  2.8
• 1996-97 176
• 
  0.5
• 2006-07 183

12
(No Transcript)
13
(No Transcript)
14
Unemployment

• Current daily status (CDS) unemployment rate
  increased from 6.1 in 1993-94 to 7.3 in 1999-00
  to 8.3 in 2004-05
• Unemployment among agricultural labour households
  sharply increased from 9.5 in 1993-94 to 15.3
  in 2004-05
• Growth of real wages of these workers decelerated
  strongly
• Employment in the organised sectors declined
  despite fairly healthy GDP growth
• (Approach Paper, Planning Commission)

15
In the 1970s-1980s

• Agricultural output increased because of higher
  investments in irrigation, new technology, seeds,
  power and roads
• Last fifteen years
• Despite higher output support price and input
  subsidies production has stagnated
• Falling public investment in agriculture
• No focus on backward regions/poor farmers
• Declining formal credit
• Falling groundwater levels, soil erosion
• Net irrigated area stagnating at 53 m ha

16
(No Transcript)
17
Tribal development
18
18
19
Indian Forest Cover                             
                                                  
                                                  
                                                  
                                                  
                                                  
                                                  
                                             
20
Reduction in poverty
20
21
(No Transcript)
22
Kendu leaf (KL) collection in Orissa

• Collectors are 1.5 million poorest - mostly women
• Govt gets 1.50 billion Rs as royalty - for every
  Rupee to plucker, royalty is 3 Rs
• Royalty on Bauxite is Rs 30 per tonne, on KL
  12,000 Rs per tonne

22
23
Unresolved Issues

• Land alienation indebtedness
• Lack of proper rehabilitation after involuntary
  displacement
• Ineffective implementation of the Panchayats
  (Extension to the Scheduled Areas) Act, 1996
• Tribals access to forests
• Shifting cultivation
• Poor programme delivery
• Political agitations vs rebellion

23
24
Thank you
25
Recommendations

• Fix quantifiable targets, such as reduction of
  IMR by three percentage points every year
• All tribal children to be covered by
  supplementary nutrition, MDM and immunisation
• 90 of vacant posts to be filled up within a year
• Absenteeism to be monitored by independent
  monitors and reduced by 50 in a year
• PDS monthly supplies would improve to 25 kg in a
  year
• Teaching in mother tongue
• Incentive for teachers/ health workers
• Link NREGA in tribal areas to forest regeneration
  and water conservation, and locally relevant
  livelihood
• Stronger legislation on tribal land alienation
  and usurious money lending
• Link funds to states with performance

26
Water Famine in India How Real?

• During April-May 2000, the Maharashtra Government
  in India was supplying drinking water through
  tankers in about 3000 villages, many of these had
  a well-irrigated sugarcane crop. Thus groundwater
  was being monopolised by rich farmers, who also
  took advantage of easy availability of two other
  scarce resources electric power and capital.
  The rich farmers thus transferred the
  responsibility of satisfying peoples need for
  drinking water to the state, with the state
  abetting in the overuse of water by supplying
  them cheap power.
• Mid-term Review of the 9th Plan
• Planning Commission

27
Institutional credit for agriculture

• Has steadily fallen from 18 per cent of the total
  bank credit in the mid-1980s to 10.0 per cent in
  March 2003.
• A substantial part of agricultural loans in the
  1990s has been in the form of indirect credit,
  that is, lending for various intermediary
  agencies and deposits placed by banks in Rural
  Infrastructure Development Fund (RIDF) in lieu of
  priority sector lending.
• In the same period there has been a precipitate
  fall in small borrowal accounts (credit limits of
  Rs 25,000 or below) from 62.55 million to 36.87
  million, amount outstanding from 25 per cent to
  5.4 per cent.
• The number of rural branches has declined from
  32,981 to 32,137

28
Policy Interventions

• More investment in irrigation, power, and roads
  in poorer regions
• Provide funds for maintenance of existing assets
• Focus on backward regions/poor farmers, and not
  on high cost regions
• Farmers of backward regions are badly hit by PDS
  leakages
• Promote water harvesting programs stricter
  controls on groundwater extraction
• Improve formal credit for small farmers
• Remove controls on movement, storage, and
  processing
• Monopoly of marketing by govt parastatals
• Permit leasing in by small farmers agr
  labourers
• Food Imports as a short term strategy

29
(No Transcript)
30
(No Transcript)
31
Employment is dominated by informal sector jobs
32
Wage Growth is heavily concentrated at the top end