Day 16 – Q. 2 Examine the factors leading to regional disparity in per capita income in India? What measures have been taken by the government to bridge the regional gap. Discuss.

Examine the factors leading to regional disparity in per capita income in India? What measures have been taken by the government to bridge the regional gap. Discuss.

भारत में प्रति व्यक्ति आय में क्षेत्रीय विषमता लाने वाले कारकों का परीक्षण कीजिए। क्षेत्रीय अंतर को पाटने के लिए सरकार द्वारा क्या उपाय किए गए हैं? चर्चा करें।

Approach –

In this question candidates need to write about the factors that leading to regional disparity in per capita income in India. In second part of answer write about what measures taken by government to bridge regional gap.

Introduction-

Regional development disparity is a continuous developmental challenge for Indian policy makers.It is reflected by the indicators like per capita income, the proportion of population living below the poverty line,etc.however government has taken various steps to bridge the gap.

Body-

Within democratic polity, growth and prosperity must exhibit regional balance. Thus a democratic government striving to achieve such balance is axiomatic.

• Goa has the highest per capita income among 33 Indian states and union territories, followed by northeast state Sikkim. Capital Delhi, Chandigarh, and Haryana complete the top five list. Among the five richest economies of India, three are states, and two are union territories
• Among Top seven richest states/UTs, five have a population of less than two cr (20 million). And, one has a population below three crores.
• 6th ranked Karnataka has the highest figure among states population having more than three cr, followed by Kerala, Telangana, Gujarat, and Uttarakhand.
• All five South Indian states have higher gdp per capita than India’s average. Bihar, Uttar Pradesh, Jharkhand, Manipur, and Assam are the top five poorest states.
• GSDP Per capita of Goa and Sikkim are above three times India’s average. GSDP per capita of Bihar is three times lower than of India.
• In US Dollar, the GDP per capita of Goa is $6,997 in 2019. Four states/UTs have GSDP per capita above $5,000, and only Bihar has below $1000.

Causes of Regional Disparity-

Historical Factors-

• The British government and industrialists developed only those regions of the country which possessed rich potential for prosperous manufacturing and trading activities. Thus port cities like Bombay, and strategically important areas like Calcutta and Madras received initial development.
• In the absence of proper land reform measures and proper industrial policy, the country could not attain economic growth to a satisfactory level.

Geographical Factors-

• The difficult terrain surrounded by flood prone areas, hilly terrain, rivers and dense forests leads to increase in the cost of administration, cost of developmental projects, besides making mobilization of resources particularly difficult.

Location Specific Advantages-

• Due to some locational advantages like availability of irrigation, raw materials, market, port facilities etc. some regions are getting special favour in respect of site selections of various developmental projects e.g. oil refineries are mostly located in close to sea.

Early Mover Advantage-

• New investment in the private sector has a general tendency to concentrate much on those regions having basic infrastructural facilities.

Failure of Planning Mechanism-

• Local needs; one size fits all approach, lack of adequate resources, poor implementation of plans, lack of planning capacity at state level reduced capacity of Planning Commission to ensure balanced development.

Restricted Success of Green Revolution-

• Green revolution improved the agricultural sector to a considerable extent through the adoption of new agricultural strategy of high yielding variety seeds, assured irrigation, provision of technical knowhow etc
• However, the benefit of green revolution were restricted to Punjab, Haryana and western Uttar Pradesh as this belt had advantage of irrigation facilities, were traditionally wheat growing states, with adequate policy support from State Governments which other areas lacked and couldn’t reap benefits of Green Revolution.

Law and Order Problem-

• Extremist violence, law and order problem etc. have been obstructing the flow of investments into backward regions besides making flight of capital from backward states.

Government Interventions to Reduce Regional Disparities-

• Higher resource transfers from the Centre to the Backward States via,finance commission in the form of non-plan transfers.
• Since 1969 a Special Category status was introduced which was in operation till 13th Finance commission to provide greater percentage of grants to such states from Centre.
• The large weight given to “Income Distance” by 14th Finance commission is an important step towards plugging the gaps in per-capita income between states.
• Development Programme-Programmes of agriculture, community development programme, Drought Prone Areas Programme, irrigation and power, transport and communications and social services aimed at providing basic facilities and services to people in all the regions.
• Provision of Facilities in Areas which Lag Behind Industrially-River valley projects and multi-purpose projects e.g. Narmada Dam for dry parts of Gujarat and Madhya Pradesh, proposed Ken-Betwa inter river link project for Bundelkhand region etc.
• Programmes for the Expansion of Village and Small Industries-Village and small industries are spread all over the country and various forms of assistance provided by the Central and State Governments are made available in the areas according to programmes undertaken.
• Diffusion of industrial activity and infrastructure-Subsidies, exemptions and tax breaks given to industries for investing in backward regions. For instance North East Industrial and Investment Promotion Policy(NEIIP) for Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, and Tripura; Special Package Scheme for Himachal Pradesh, Uttarakhand and J&K.

Conclusion –

India’s geographical diversity and different levels of development across regions mean that location specific targeted action would be required in less prosperous regions to ensure that a minimum acceptable level of prosperity.