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This is an archive article published on June 14, 1997

The awful truth

The UNDP's new human poverty index (HPI) reveals what GDP growth rates hide: huge inequalities within countries in income and opportunity. ...

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The UNDP’s new human poverty index (HPI) reveals what GDP growth rates hide: huge inequalities within countries in income and opportunity. The HPI ranks a country according to the proportion of its people who die at an early age, are illiterate and do not get sufficient food, safe drinking water and basic health care. As is to be expected, India appears among the lowest third, ranking 138 out of 175 countries. Even this does not reveal the whole awful truth. A headcount would show the largest number of poor and deprived people in the world live here. The good news is something can be done about it and it need not take another 50 years. As the Human Development Report 1997 points out, two things are essential. One, India needs sustained public action to eliminate the worst forms of human poverty and promote an equitable expansion of social, economic and political opportunity. Two, globalisation is hurting the poor and it must be managed better.

The report makes important contributions on two fronts. It challenges the trickle down assumptions of conventional development theory and argues that governments must do more, not less, under market liberalisation to create level playing fields within the country and in the global arena. Worldwide experience proves the poor do not automatically benefit from higher economic growth rates. Developing countries which have done better at removing poverty improved social provisions substantially even with low per capita income levels. Most did so before opening up their domestic markets.

In other words, they aimed for broad participatory growth. Globalisation under the prevailing rules of the game does not do all countries good. The annual loss to developing countries from the present unequal trade regime is $500 million and the weaker among them are being impoverished further. While there is no escape for India from an open system of trade and finance, there is no reason to accept unequal terms. Developing countries have to work together to change them.

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Looking at the big picture there may be grounds for optimism about the eradication of poverty in India early in the next century. Reform policies have accelerated economic growth, the Central Government claims to be concentrating on the essentials (drinking water, elementary education and primary health) and hitherto powerless groups, the OBCs and Dalits, play an important part in the political system. So far so good. But despite claims to the contrary, social sector spending has been falling alarmingly, especially in the States. Above all, what about the nitty-gritty of social development? It is in the details that policy-makers fall down. A central budget and legislation for free and compulsory elementary education are in the pipeline. But no one knows how to make teachers teach in UP or prevent blackboards from disappearing in Bihar.

Politicians and bureaucrats are unreliable, people’s organisations too few and far between, and parents, for good reason, are totally cynical about the whole exercise. So what is to be done? Find the answer to that one and there will be real grounds for optimism about removing poverty.

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