The Causes and Consequences of Uneven Growth

In India due to the negligence in economic reforms the only solution remains is to privatization.
Due to political interested the agriculture economy and reforms are completed in town or in
more urban areas only. The observers of India forced to rethink about their policies and break the
biased against the rural area. Even in this situation some prominent personalities like Mr.
Manmohan Singh and others made the impact and one can called this as a success story.

All this reforms led to increase the gap between rich people and poor people , which was
definitely unintentional. Increased in the per capita income by 3.5%-4% is evidence of the
mentioned success story.

India western and eastern states performed differently , the reason is western states are getting
richer and richer due to good policies and talent. Since last 20 years the peoples of Bihar and
effected by pooor governance. Laloo Prasad government gave dignity to yadavs and Kurmis and
protection to Muslim Community, but he didn’t made some good governance policies for labors
and attracting some good investment. The states GDP fallen from1990-01 to 2003-04 , where as
the residents of western Bihar gained increased in wealth.

According to author the main reason for UP and Bihar to be backward is not the central
government policies but of their own regional states policies which led to this situation.

According to Besley and his team even if economic growth comes to UP and Bihar due to
uneven distribution of land, poor education system and lack of infrastructure will reduced down
the net effects and might not that impact which is expected. In Bihar even today also agrarian
reforms are needed , but unfortunately this is not in their main agenda. India approx.60% peoples
are directly or indirectly dependent on agriculture, but it contributes only 20% in GDP and this
contribution is expected to decrease in fore coming years. More and more young men and
women are getting quality education. Although India is working for better in education but still
lacking in jobs growth and urban poverty. IT sectors is booming although it contributes only 1%
of GDP and accounts only for 2% services in the nation. Experts says manufacturing sector is
working great and giving jobs since 1990. Authors writes, above all the main matter is public
goods are available or not.

Comment: FDI will increase the GDP but also cause the inflation and in this pandemic situation
India cant tolerate increase in price of daily goods.Government should consider this fact also.