Growth rate for industrial production slows down!In this current year!
Rate of economic growth matters? Or, the kind of economic growth really matters? Why our policy makers haven’t promoted all-round growth?
The Prime Minister talks of inclusive growth. Fine. But why the inclusive growth is not happening? Why some segments are outside the growth story? For instance, agriculture? Why even the rate of employment growth. As per the latest data there are signs of a sort of a definite recession in industrial production. Indian industry has recorded dismal growth for April-September 2007 period with almost 60 per cent of the 91 sectors surveyed recording a low growth rate of below 10 per cent. Basic goods, including cement, fertiliser, and polymer, steel as well as intermediate goods recorded either moderate or even negative growth, according to a recent CII-ASCON survey.
The more important point here that even among the excellent rates for certain sectors, the rate of per cent ages for the good sectors had declined, while the percentages for the moderate and negative sectors had increased. The Central Statistical Organisation index of industrial production has growth only by 9.2 per cent during the first six months. The same period of last year saw a growth rate of 11.1 per cent.
Last year it was a dream run, a record of 11.6 per cent growth and there were hopes of a repeated performance this time of the year also.995 companies were surveyed and the Indian industry was hopeful of going to the next stage of the Indian economic growth curve and yet these hopes were belied by this sudden downward trend. Why? Explanations can vary depending upon who is the explainer! For the PM, it is rather an ironic silence that tells his predicaments or his own personal compulsions to remain silent. For an average official and even for the otherwise pretentious characters among them, some of them otherwise sport their expertise over their sleeves; the explanations can be based on some ideological mumbo-jumbo! As for our otherwise smart Finance minister, it is the story as usual. He would brush aside any discomfort able thoughts such reality would present and he would still go for a falsely confident tone and say that there is no cause for worry, the stock markets are performing and even delivering the results, as he seems them. For the FM, it is the 9 plus growth rate that matters, it seems.
That is why he pins his hopes on the financial sector performance and he goads the banks to lend, not to social and priority sector but to any sector that cares to borrow and give the minister and the government a sense of satisfaction. Can the government hope for such a satisfaction when the ground level realities are otherwise. There is a rather inadequate understanding and appreciation of the sort of economy
Our economy is still a growing economy or rather a fast transforming economy and society. Yes, the difference between our economic activities and our social perceptions of how we make our living, this from the average common man’s perception is still very blurred or unformed. Thus, there is a mad rush to get into computer courses, from school to college levels and thereafter, a mad rush to get into software and BPO jobs. There is only one thought. How quickly one can make quick money, come what may.
Thus, already we see the squeezing of places, be it educational placed or job market and there is a skewed development with disproportionate number of persons who seek places in education and the job market left out of the race. So huge is the demand for education and jobs and yet there is huge unmet demand! This is no the sure sign of a healthy, all-inclusive and balanced growth of the economy.
One hopes the leaders, from the Prime Minister to the FM down to others, the vast army of expert panels that are supposed to report to the PM(where is the time for the poor man to keep count of how many panels he constituted and what they are really doing!),the harsh reality of the economy, be it agriculture or villages or the fast growing urban centres, the huge student population and the huge demand for jobs give them a sense of real perspective to come up with a growth path for the Indian economy.
Certainly, ours is now evolving fast into a full-fledged private capitalist economic model, and there is no doubt about it and almost every step taken by the government is about allowing the private sector players, in particular, the large players to dictate terms and follow the private sector moves, be it FDI or the finance flows from abroad into the rather uncontrolled and even chaotic stock market and we in a positive way seem to stand to gain by the new investments that are flowing into real estate and other basic sectors like steel, and other mining sectors and also in all the infrastructure sectors.
The question remains: are we achieving the inclusive growth as our current policy mix are or we consciously can spell out in what specific forms we hope to achieve the inclusive growth about which we hear often from the PM.
As it is we can all say clearly is that we don’t seem to be planning any hopeful policy mix to give a push to the inclusive growth. There is clearly no such policy in the larges sector, namely, agriculture, right?
Simply because our policy makers don’t come through the legitimate democratic processes to the seats of power. The intimate link between the polity and the economy can be seen how the polity is largely sabotaged by a process of coalition building that saw the elevation of a non-elected leader to the highest seat of power and how the party leader also saw to it that persons with no claim to merit or mass base get into key ministerial posts. With this sort of setup what sort of new ideas or new visions would come into play in the higher policy making?
So, our economy is growing, yes, but not all that is glittering is gold.
May be this is the