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Gujarat’s growth for growth’s sake
Data shows that the state is high on growth, low on development. What does this say about the government’s priorities?
No matter what the political leanings, many people have come to accept the premise that Gujarat has performed a lot better than the rest of India in terms of development over the last decade. People are even talking about the Gujarat model of development as something for the whole country to emulate. The backwardness indices of states computed by the Raghuram Rajan Committee (set up to come up with a formula to allocate the Centre-to-states funds) seemed to place Gujarat somewhere in the middle of the pack; a total surprise given the common perception.
First, we will take a look at Gujarat’s growth performance and then examine to what extent the growth has resulted in “development”.
Clearly, Gujarat has done very well in terms of growth in every sector. There are a few states that have done better in individual sectors, but mostly they are small states like Sikkim, Chhattisgarh, Manipur, Mizoram and Uttarakhand, where a small increase ends up being a big percentage change. Among the rest, Gujarat is at the top in terms of growth. Gujarat’s performance in agriculture is especially noteworthy.
Growth is a means to an end and the end is development. Development means less poverty, better education, better healthcare, and better access for more households to water and proper sanitation. Development means laying the groundwork for a better tomorrow.
Let us first look at the main development indices. Since we are concerned about the performance of Gujarat relative to that of the other 27 states, we will look at Gujarat’s rank among 28 states.
The first thing to note is that the composite performance index computed by the Rajan committee, which gives equal weight to the improvement over the last decade or so in each category of backwardness such as education, health, household amenities, places Gujarat 14th among 28 states. For more details.
Despite the fact that Gujarat grew faster than most other states during the decade of 2001-11, its per capita expenditure is not only not at the top of the chart but has slipped further to the 12th position. Equally surprising are its ranks in, one, the extent of poverty and, two, in female literacy: they are smack in the middle of the list at 14th and 15th respectively, showing no improvement by 2011-12 despite fast growth. It does show some improvement in its ranking for “Infant Mortality Ratio” from 19th to 17th, though the record of being in the lower half of the class is still disappointing for such a fast growing state.
Gujarat is known for its roads. What do the data tell us about its relative performance in road-building?
Gujarat’s high rank in state highways in 2004-05 conforms to the common perception. It is possible that its rank in state highways has slipped a little due to some of the state highways becoming designated as national highways. Its ranking in smaller road network, however, was not that high in 2004-05 and has fallen further. States like Maharashtra, Haryana and West Bengal have gone past Gujarat on this score. It would be good to find out if the fall in the rank in this case is also due to a significant number of small roads in Gujarat having become state highways.
Many have talked about reaping the dividend from the relatively young Indian population by educating them well. How well
does Gujarat do in schooling? The Rajan committee uses “Attendance Ratios” and “Number of Primary Schools per Population of 1,000” as education variables and ranks Gujarat somewhere among the bottom six states in 2004-05 and the rank slips further by 1 or 2 by 2009-10. Perhaps these are not the most appropriate variables to assess the quality of education offered. Here we can hardly do better than using the learning outcomes reported by ASER for all states from 2006 to 2012. (Tripura and Sikkim were not included in ASER’s 2006 sample). (See Table 4)
These numbers too are shocking for a state claiming to be number one. Instead of moving up, it has slipped down in an area as vital as education.
What about household amenities and financial inclusion? Once again, we see mediocre performance and further slippage in Gujarat’s ranking from 2001 to 2011 (Census years). (See Table 5)
This is a perplexing picture of development. Gujarat has done so much better in terms of growth and so much worse in terms of development than other states. Why has the fast growth not translated into meaningful development? Finally, it is the grassroot-level institutions that run schools, health clinics, bring water and sanitation to households, and bring the fruits of growth to the multitudes. Could it be that the centralised model of governance that works well for big investment projects does not work as well for grassroot institutions? Or, is this high growth with low development model indicative of the priorities of the government of Gujarat? Or is it something else altogether? It would be good to know the answer.
The most intriguing question of all is: what sustains the belief that Gujarat is the crowning jewel of development in India?
Kotwal is professor of economics and Arka Roy Chaudhuri is a PhD candidate, University of British Columbia, Canada.