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 Book Reviews
A.A. Deaton and V. Kozel (eds), The Great Indian Poverty Debate
A.K. Mehta and A. Shepherd (eds), Chronic Poverty and Development
Policy in India
(reviewed by Richard Palmer-Jones) 285
Dipak Mazumdar and Sandip Sarkar, Globalization, Labor Markets
and Inequality in India
(reviewed by Pieter Serneels) 294
Nivedita Menon and Aditya Nigam, Power and Contestation:
India since 1989
(reviewed by Jamie Cross) 298

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Mazhar Aziz, Military Control in Pakistan: The Parallel State
(reviewed by Farhan Hanif Siddiqi) 300

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Santosh Mehrotra and Enrique Delamonica, Eliminating Human

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Poverty: Macroeconomic and Social Policies for Equitable Growth
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(reviewed by Baruch Ramírez-Rodríguez) 302
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Partha S. Ghosh, The Politics of Personal Law in South Asia: Identity,
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Nationalism and the Uniform Civil Code

(reviewed by Carolien Stolte) 305
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K.S. Chalam, Caste-based Reservations and Human Development in India

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S.M. Michael (ed.), Dalits in Modern India: Vision and Values

(reviewed by Venkata Vemuri) 307
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Ramaswamy R. Iyer, Towards Water Wisdom: Limits, Justice, Harmony

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(reviewed by Joe Hill) 311

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S. Mahendra Dev, Inclusive Growth in India: Agriculture, Poverty

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and Human Development

(reviewed by Rashmi Bhat) 314
K.G. Karmakar (ed.), Microfinance in India
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(reviewed by Maren Duvendack) 317

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284 „ Journal of South Asian Development 4:2 (2009): 283–320

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 Journal of South Asian Development 4:2 (2009): 283–320
SAGE Publications Los Angeles/London/New Delhi/Singapore/Washington DC
DOI: 10.1177/097317410900400206

A.A. Deaton and V. Kozel (eds). 2005. The Great Indian Poverty Debate. India:
Macmillan India. xix + 600 pp. Rs 820. ISBN 1403 926441.
A.K. Mehta and A. Shepherd (eds). 2006. Chronic Poverty and Development Policy
in India. New Delhi: Sage Publications. 411 pp. Rs 720. ISBN 07619 34642 (HB)
8178296144 (India-HB).

These two substantial collections of papers provide extensive discussion on the

measurement of poverty in India in recent years by many of the most distinguished
contributors to this topic. This is certainly an interesting, important and much

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debated issue of wide interest, in part because, as Montek Singh Ahluwalia,
Deputy Chairman of the Indian Planning Commission writes in the foreword

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to The Great Indian Poverty Debate, India subsequently experienced a significant

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increase in economic growth and is distinguished in having ‘regular household
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surveys of consumption’ (Deaton and Kozel 2005: v) dating back half a century.
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This resource, and especially its availability beyond a select group of insiders to the
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Indian Planning Commission since the late 1990s, has generated a lot of activity
among empirically-minded development economists, and many of the chapters of
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this book make use of it; but whether this has greatly enhanced our understanding
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of what has happened to poverty, let alone well-being, following the great policy
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change is perhaps more open to question.

The ‘Great Indian Poverty Debate’ (GIPD) refers mainly to the issue of what
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happened to poverty in the 1990s, following the reforms introduced in the 1991
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budget (this timing of the change in policy has been disputed—see Panagariya,
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2009). Ahluwalia writes that the book provides a ‘thorough documentation of the
state of debate [about the effects of the changes in economic policy in India of 1991
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on poverty] as it stood in 2004’ (Deaton and Kozel 2005: v). It draws together papers
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from a number of sources: some classics in Indian poverty measurement (dating back
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to 1972); many papers from a World Bank-sponsored workshop in January 2002 on

poverty measurement, most of which appeared in the Indian weekly journal, the
Economic and Political Weekly (EPW), 37(4), 2003; some other papers published in
the EPW; and some hitherto unpublished but widely circulated papers on relevant
topics. There are in all 34 authors and the ‘NSSO Expert group on Non-Sampling
Errors’. Some of the authors make several contributions: for example, Deaton
contributes to five chapters; his co-editor, Valerie Kozel to three; T.N. Srinivasan,
K. Sundaram, A.D. Tendulkar and Abhijit Sen to two each. An introduction by the
editors (much of which has been already published in the World Bank Research
Observer, 20(2): 177–99 (Deaton and Kozel 2005), although this paper is a more exten-
sive summary of the material), provides an overview of many of the key issues.
286 „ Journal of South Asian Development 4:2 (2009): 283–320

Since the liberalising turn of the 1991 budget was hotly contested, the subsequent
trajectory of poverty was closely observed. For proponents of liberalisation,
the apparently slow growth of consumption reported from the ‘thin’ rounds
Consumption and Expenditure Surveys (CES) of the National Sample Survey
Organisation (NSSO) after the 50th (1993–4) was disappointing, and significantly
lower than the growth of consumption in the National Accounts System (NAS).
This lack of consistency between NAS and NSS (National Sample Survey) CES
(Consumer Expenditure Survey) estimates is not a recent concern. The Planning
Commission had, in the 1980s, been adjusting the CES distribution of monthly
per capita expenditure upwards by the rate of the NAS estimate of consumption.
This practise was discontinued following the report of the Lakdawala Commission
in 1993 (Government of India 1993). The apparent slow reduction in poverty cal-

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culated from NSS data prompted two responses addressed here. Some authors,
prominently S.S. Bhalla (Chapter 21), recalculate poverty after adjusting the mean

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consumption of the CES by the growth in the NAS consumption, while retaining

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the distribution of consumption of the CES. This produces much faster reduction
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in poverty. These re-calculations, however, are not very convincing. The second re-
sponse is to experiment with the survey procedures on the assumption that the CES
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was under-reporting consumption, mainly by exploring the use of shorter recall
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periods for frequently consumed items, which was found to raise expenditure in
the ‘thin’ rounds after the 50th (Chapter 10). However, changing the recall period
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would mean that the data were no longer comparable with earlier consumption
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estimates from ‘thick’ rounds up to the 50th and, since poverty is more reliably
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estimated from ‘thick’ rounds (which have much larger samples), any such trend
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would be biased, a point to which I return.

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The second part of the book has the heading ‘Interpreting the evidence’, and is
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divided into three sub-parts—‘What happened to Poverty in India in the 1990s’,

‘The Selection of Poverty Lines’ and ‘Other Data, Other Assessments’. The effect
of the change to the survey proforma in the 55th round in 1999–2000 to include
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(among other changes) a seven as well as a 30 day recall period for frequent items,
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caused an extensive debate on the validity of comparing that round with earlier
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ones, specifically, leading to an overestimate of the reduction in poverty (Abhijit Sen,

Chapter 11). Deaton (Chapter 12) proposes adjustments to take account of these
effects, and Sundaram and Tendulkar (Chapter 13) propose using the simultaneous
Employment and Unemployment Surveys (EUS) as more consistent data with which
one might assess the trend in poverty. However, using the EUS is unsatisfactory
because it also has inconsistencies over time. The EUS consumption data in the
50th round used an extensive list of items, while that from the 55th round used a
truncated schedule—the two therefore cannot be considered comparable. Further
changes in the 55th round meant that, as Sundaram and Tendulkar point out, it
was not possible to compute a welfare aggregate using 30 day recall for all items,
as had been the practice before, because in the 55th round there were no 30 day
 Book Reviews „ 287

recall reports for several groups of items. The only plausibly comparable welfare
aggregate with the 55th round would have to use a Mixed Recall Period (MRP),
which, they pointed out, reduced poverty estimates for previous rounds if the
same poverty lines were used. Notwithstanding a few ultra-optimists, most people
consider India’s official poverty estimates too low anyway. One response could be
to re-estimate poverty lines for the MRP aggregate, but this, to my knowledge, has
not been done.
Given the importance attached to obtaining an estimate of the trend in poverty
following the reforms, Deaton (Chapter 12) proposes a method to adjust the 55th
round expenditure estimate using the ‘30 day item’ Engel curves (the function
relating expenditure on a group of consumption items which was consistently
reported for a 30 day recall to total expenditure). To be valid, this method requires

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the 30 day item Engel curves to be stable over time, an assumption which Deaton
claims is supported in a work by a co-author (Tarrozi 2004). The method was re-

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jected by Popli, Parikh and Palmer-Jones (2005), and the assumption is challenged

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by Abhijit Sen and Himanshu in Chapter 14, where they show that the 30 day items
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Engel curves were trending upwards, at least between the 50th and 55th rounds. This
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would mean that Deaton’s adjustments over-estimated the fall in poverty.
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Deaton’s response in this book seems to be that it is ‘hard to reconcile [with “a

substantial increase in the consumers expenditures on the six categories that were
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consistently surveyed using 30-day recall”] without there having been a substantial
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increase in total expenditure, and thus in the fraction of the population that is poor’
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(Deaton and Kozel 2005: 12). However, such a shift in Engel curves could occur if
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the food required to attain a given standard of living fell because of changes in the
health environment, demographic structure of households, or reductions in the
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energy intensity of livelihoods, as argued by Dubey and Palmer-Jones (2005a, 2005b,

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2005c), or if it became necessary to spend more on other items to attain a given

standard of living. Or it could be that the level of food consumption reported in the
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surveys was falling because of changing consumption habits, or declining interview

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quality affecting frequently more than infrequently consumed items, as suggested

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by Palmer-Jones and Sen (2001). In a more recent paper, discussed in the following,
Deaton (Deaton and Dreze 2009) now seems to accept that the apparent fall in food
consumption at constant real expenditure (which is nearly equivalent to what he
writes in the phrase inserted earlier) might occur without a fully corresponding rise
in well-being, as testified by the relatively slow improvement in child nutritional
status (across rounds of the National Family Health Surveys (NFHS)).
The second sub-section of Part 2 addresses the issue of poverty lines, including
Ashok Rudra’s critique of the original ‘20 rupees per capita per month’ poverty line
of 1960, and three papers by Deaton, one with Alessandro Tarrozi, and another with
Jean Dreze. Deaton and Tarrozi propose new poverty lines based on price indexes
calculated with the Tornqüist formula from Unit Values (UV) and (democratic)

Journal of South Asian Development 4:2 (2009): 283–320

288 „ Journal of South Asian Development 4:2 (2009): 283–320

Average Budget Shares (AvBS) that can be calculated from the CES surveys. These
UV PLs (Poverty Lines) suggest significant increase in the poverty count in rural
Andhra Pradesh and reductions to poverty in the urban sectors in most states in
the 50th round compared to official estimates which he asserts are ‘too large to be
credible’ (Deaton and Kozel 2005: 15). He further finds that poverty lines increased
less rapidly over time so that poverty fell rather faster using his new PLs (Deaton
and Kozel 2005: 16), a finding to which we return below. Deaton updates these UV
PLs and poverty counts to the 55th round incorporating his adjustments to the 55th
round, finding there was a 7 per cent reduction in poverty between the 50th and
55th rounds rather than the 10 per cent estimated by the Planning Commission.
Nevertheless, and contrary to India’s development pessimists, Deaton and Dreze
(Chapter 18) argue that there was substantial progress in other dimensions of

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well-being over the 1990s (after liberalisation), reinforcing the view that growth
had benefited the poor, if unevenly across social groups.

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Subsequent sections of the book provide further perspectives on issues of poverty

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measurement in India since liberalisation. Meenakshi and Vishwanath (Chapter 24)
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on Calorie Deprivation in Rural India in 1983 and 1999–2000 address what turned
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out to be perhaps the most noisy debate. This concerns the apparent gap between
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poverty as measured using poverty lines and ‘calorie’ poverty, that is, numbers of
people living in households whose per capita availability of calories falls below the
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norms of 2,400 per capita per day for rural and 2,100 for urban households. While
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‘calorie’ poverty had risen substantially over time, money-metric poverty had, by all
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estimates published here, fallen; Meenakshi and Vishwanath call for poverty lines
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to be revised to produce poverty counts which concur with those based on these
calorie norms, which the editors note but do not comment on. In their more recent
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paper, Deaton and Dreze (2009) have disagreed with Meenakshi and Vishwanath—
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I return to this in the following.

There is no doubt that the book provides a valuable resource for the many
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scholars and students who are or may become concerned with these debates which
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are important for reasons already noted. The selection is not comprehensive and
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there are some perhaps surprising omissions such as Dandekar and Rath’s (1971)
seminal early contributions, Chatterjee and Bhattacharya’s (1974) calculation of
state poverty lines using Unit Values from the NSS, the key Government of India
reports setting out the logic of official poverty measures (the 1979 Report of the
Technical Committee; the 1993 Report of Lakdawala Commission; Ravallion’s (2003)
contribution to the NA versus NSS debate). The selection is, however, adequate to
inform if not enlighten the reader.
Nevertheless, it is worth noting ‘what happened next’, because it draws attention
to flaws in the debate as represented in this book. In the meantime, Dubey and
Palmer-Jones (2005) produced a wide ranging critique of the Deaton and Tarrozi
UV CPIs and their method of deriving poverty lines from them. They suggested
 Book Reviews „ 289

revised methods taking account of differences in prices on non-UV items and the
greater shares of non-UV items in urban areas.1 They suggested that it was plausible
to compare the MRP consumption aggregates across rounds, because the biggest
distortion in the 55th round came from the need to use the 365 day recall for most
of the infrequently consumed items. They too found that money-metric ill-being
fell over the 1990s and this was corroborated by falling infant and child mortality
rates, and child stunting, wasting and under-nutrition, as shown by comparing these
figures in NFHS1 and NFHS2 (Dubey and Palmer-Jones 2005).
Given the debacle of the 55th round the 61st was eagerly awaited, as was NFHS3
(2005–6). The first papers to respond to the 61st round appeared in the EPW in
January 2007, by Himanshu, and by S. Mahendra Dev and C. Ravi. Using the dis-
credited Official Poverty Lines (OPLs) and tabular data did not prevent these authors

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from drawing confident conclusions that indeed poverty had fallen between the
50th and 61st rounds. Most of the fall had taken place between the 55th round and

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the 61st, and little, if any, between the 50th and 55th. Thus, they suggested, poverty

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reduction had disconnected from agricultural growth, which had grown faster in
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the earlier period. This conclusion is of course welcome to those who would see in
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agricultural growth, such as the Green Revolution, little to benefit the poor. Palmer-
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Jones and Dubey (2007) use the unit records of the 61st round to update Dubey
and Palmer-Jones PLs to the 61st, and by using the MRP welfare aggregate suggest
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that what poverty reduction had occurred was mainly between the 50th and 55th
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rounds rather than the 55th and 61st—the direct opposite of that suggested by
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Himanshu and by Dev and Ravi, thereby re-establishing the connection between
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poverty reduction and agricultural growth.

More recently Deaton (2008), and Deaton and Dreze (2009), point to the flaws
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in the official estimation of poverty in the 61st round due to continued use of
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official poverty lines and CPIs. In computing poverty lines for the 61st round,
Deaton subtly changes his methods compared to the earlier papers in two ways, to
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neither of which is attention explicitly drawn, and both of which are prefigured in
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Dubey and Palmer-Jones. But there continue to be flaws in the new Deaton method
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which warrant caution in drawing the conclusion that ‘three years of progress were
undone’ (Deaton 2008) by failing to adjust OPLs. These flaws include anchoring
urban PLs in official urban PLs, and the use of (democratic) average shares for the
whole population, rather than the poorer groups in society (as shown by Dubey
and Palmer-Jones).
Acknowledging, perhaps, that money-metric poverty estimates need to be
corroborated with outcome indicators of well-being, Deaton and Dreze use the
NFHS3 to report child and adult anthropometric outcomes (among other vari-
ables). However, they draw attention to a potential problem in that trends in child
stunting, which show improvements, may be contradicted by those in wasting,
which show deterioration between NFHS2 (1998–9) and NFHS3 (2005–6). It is not

Journal of South Asian Development 4:2 (2009): 283–320

290 „ Journal of South Asian Development 4:2 (2009): 283–320

clear what one must make of this, but the broad thrust of this paper is that there
has been progress as corroborated by the growth of adult heights over cohorts.
There is however another problem with the adult heights, as they note, in that for
equivalent cohorts the women in NFHS2 were some tenths of a centimetre shorter
than the same cohort in NFHS3. There is a further problem with their use of adult
anthropometry—they make the erroneous argument that men’s heights have
increased faster than women’s, even though there appears to be no disadvantage in
girl child anthropometry compared to boys (up to the age of 5). They rationalise
this by suggesting that the discrimination against females occurs after the age of
five, for which there is little evidence, and is anyway not particularly plausible since
the growth spurt in boys and girls in their teens is small and seems little affected
by nutritional intakes. It is true that absolute heights of men increased faster

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than women’s, but one would expect so from gender dimorphism (men are on
average taller than women). Once adult heights are standardised against a nearly2

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unconstrained adult population, the rate of change of adult heights over cohorts

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appears if anything to favour females (Palmer-Jones 2009; unpublished manuscript,
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available on request).
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Turning now to Chronic Poverty and Development Policy, which arose out of
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a workshop in Delhi in 2003 on ‘Chronic Poverty and Development Policy in

India’, organised by the Chronic Poverty Research Centre India, which the preface
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claims, ‘put one key policy response—social protection—firmly on the agenda

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of the international community’ (Mehta and Shepherd 2006: 19). This policy
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agenda (Social Protection; hitherto SP) has indeed gained some prominence in the
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development arena and has attracted considerable funding from major multilateral
and bilateral donors: the World Bank, Asian Development Bank, ILO, DFID and
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so on. Within the British development industry, for example, Chronic Poverty
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and Social Protection have presence at the University of Manchester, the Institute
of Development Studies (at the University of Sussex), the Overseas Development
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Institute (in London) and others who have researchers engaged in SP ‘research’ and
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advocacy; these topics are big (development) business. All this might be considered
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somewhat surprising given the origins of SP in Western welfare states (or social
security systems) as that component which aimed at poverty relief based on transfers
rather than insurance.
Now, it is commonplace in poverty analysis that there are a significant proportion
of type 1 and type 2 errors amongst the money-metric poor—those who are poor
but are not so classified, and those who are not poor but are so classified—and there
are those who are transitory poor, maybe because of an idiosyncratic shock that has
a short term effect. Type 1 error in poor and the transitory poor do not warrant
the same concern as those who are, expected to be or mis-classified as not poor. A
focus on reducing money-metric poverty risks neglecting those more deeply and
continuously deprived. Thus, amongst the poor, it can be felt, we should focus on
 Book Reviews „ 291

the long term (chronic) poor. This may require different methods, especially longi-
tudinal studies and panel data sets, and lead to a different diagnosis and prescription.
To focus, it is claimed here, on poverty dynamics and drivers of escape from poverty
could give rise to quite different poverty descriptions, diagnoses and analyses.
A test of the value of this edited volume with 20 authors and 12 chapters must
be whether it does indeed provide different and valuable perspectives compared to
conventional analyses. Although the argument is plausible, I found myself generally
frustrated by the quality of the chapters in this book, most of which still rely mainly
on cross-section data analysis. A book like this can be read in two ways—more or
less from front to back as an introduction to the overall approach (in this case that
of chronic poverty), or as an authoritative reference or source of information on
the topic, by choosing chapters that address topics of particular interest identified

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in their titles. This book can be read in neither. If one starts at the beginning,
particularly with the editors’ introductory and overview chapter, one begins to

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feel that the book has been assembled in a rather hasty and ad-hoc manner. It is

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an impression that grows, as does the view that the authors of individual chapters
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have not improved their chapters from the workshop contributions by focussed
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and rigorous reviewing by the editors.
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The chapter, ‘Correlates of Incidence and Exit from Chronic Poverty in Rural
India: Evidence from Panel Data’ by Bhide and Mehta, does use a panel—the
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National Council of Applied Economic Research (NCAER) panel surveys of

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1970–1 and 1981–2, and finds that larger households, households in particular
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regions, with a high proportion of children, ST households, and those dependent

C

on (particularly agricultural) casual labour (see also Chapter 3), are particularly
likely to be poor. There is nothing new here since we already knew that the poor
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were spatially concentrated (see Chapter 9), that STs and SCs and agricultural
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labourers were particularly likely to be poor, and that poverty among SCs had
declined faster than among STs. Even the identification of females as particularly
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deprived can be shown from cross-section surveys such as the NSS CES and EUS,
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which can identify deprived social groups and changes in their deprivations over
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time. The (cross-section) NFHS which records anthropometric status, morbidity

and mortalities can identify inequalities within households (provided they also
record relevant male data).
Indeed, the next two chapters, ‘Rural Casual Labourers, Wages and Poverty:
1983 to 1999–2000’, by Bhalla, Karan and Shobha, which analyses the EUS of the
NSSO, and ‘Extreme and Chronic Poverty and Malnutrition in India: Incidence
and Determinants’, by Radhakrishna, Rao, Ravi and Sambi Reddy, use these (NSS
and NFHS) surveys. The latter combines NFHS data with NSS, suggesting that
the chronic poor are the extreme poor as measurable from cross-section surveys.
Radhakrishna et al. identify these as those whose value of consumption is less than
75 per cent of the official poverty line, and have a malnourished child. In fact the

Journal of South Asian Development 4:2 (2009): 283–320

292 „ Journal of South Asian Development 4:2 (2009): 283–320

spatial, temporal and social patterns of extreme poverty (profiles) are very similar
to those of (conventional) poverty, and the chapter does not draw attention to or
attempt to analyse any differences, which means that the reader cannot judge the
value added by using this definition.
Several other chapters use the official survey data or their own cross-section
surveys, for example chapters covering ill-being among the elderly (Chapter 5),
oustees from a wildlife sanctuary (Chapter 6), females in a Delhi slum (Chapter 7)
and safety-net programmes (Chapter 12). Chapter 9 mines NSS and NFHS data
using a technique (K-SOM) which has some similarities with data reduction tech-
niques such as factor analysis, to produce maps of Indian districts and, in a case
study of Karnataka, of clusters of talukas. However, the maps are of poor quality and
different categories are not readily distinguishable. From the text, some interesting

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cross-state patterns appear to emerge reinforcing the argument that states may be
poor units of analysis (see Palmer-Jones and Sen 2003, 2006a, 2006b), and further

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discussion of this analysis would have been informative.

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Other chapters on political perspectives on chronic poverty (Chapter 8), gov-
IA
ernment policy in rural areas (Chapter 10) and technological change in food pro-
C
duction (Chapter 11) are by distinguished Indian intellectuals, but are somewhat
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idiosyncratic and add little to what the well-read reader already knows.
Do the Great Indian Poverty Debate or the Chronic Poverty and Development Policy
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in India add much to understandings of poverty? Is the Great Indian Poverty Debate
M

‘great’ in terms of its substantive import, or is it ‘great’ because it is of high quality?

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Does the impetus for SP add viable policies for addressing poverty? Or perhaps,
C

more relevantly, are they worth the cost? These books certainly are about important
topics which may affect the life chances of billions, and they certainly have many
R

eminent contributors, and many of the papers are argued with academic skill; but
FO

it is not clear that there has not been considerably more heat than light generated
in the key contributions. This leads to questions about the way in which this policy
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arena is conducted, who participates, whose voices are heard, and so on. Is it a case
O

of ‘could do better’? Or is something rather more profound suggested, given the

N

somewhat circumspect conclusions of Deaton and Dreze (2009) that there should
be ‘regular and reliable large scale surveys that would make it possible to monitor
the nutrition situation …’ (p. 63), echoing the conclusion of DPJ that ‘economists
... become more concerned about its [data] quality and … its production [than its
manipulation]’ (p. 326)?
There is a joke that is rather pertinent at the time of writing (Spring 2009), that
the problem of avoiding bankruptcy is not that you have borrowed too much, but
that you have not borrowed enough, since if you had borrowed more you would
have been too important not to be ‘bailed out’. I wonder if this has not got more
than a grain of relevance to both the poverty measurement and social protection
businesses?
 Book Reviews „ 293

NOTES
1. They also argued that states and urban areas were inappropriate heterogenous units for
assessment of poverty; rather NSS regions and towns of different size had different costs
of living and should have there own CPIs, and poverty lines, as should different groups in
the expenditure distribution. These arguments were demonstrated using Unit Values from
the CES, and new poverty lines and poverty counts were produced for these geographical
units for all the thick rounds from the 38th to the 55th.
2. This qualification is required because adult heights of western population continue to
increase.

REFERENCES

SE
Chatterjee, G.S. and N. Bhattacharya. 1974. ‘Between State Variations in Consumer Prices and

U
Per Capital Household Expenditure’, in T.N. Srinivasan and P.K. Bardhan (eds), Poverty
and Income Distribution in India. Calcutta: India Statistical Publishing Society.

L
Dandekar, V.M. and N. Rath. 1971. Poverty in India. Pune: Indian School of Political Economy
IA
(also in Economic and Political Weekly, Vol. 6, 1971).
C
Deaton, A. and V. Kozel. 2005. ‘Data and Dogma: The Great Indian Poverty Debate’, World
ER

Bank Research Observer, 20(2): 177–99.

Deaton, A. 2008. ‘Price Trends in India and their Implications for Measurement of Poverty’.
M

Economic and Political Weekly, 43(6): 43–49.

M

Deaton, A. and J. Dreze. 2009. ‘Food and Nutrition in India: Facts and Interpretations’,
Economic and Political Weekly, 44(7): 42–65.
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Dubey, A. and R.W. Palmer-Jones. 2005a. Prices, Price Indexes and Poverty Counts in India
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during 1980s and 1990s: Calculation of UVCPIs, Artha Vijnana, 223–58.

R

———. 2005b. Prices, Price Indexes and Poverty Counts in India during 1980s and 1990s:
FO

From CPIs to Poverty Lines? Artha Vijnana, 259–86.

———. 2005c. ‘Poverty Counts in India during 1983: New Poverty Counts and Robust Pov-
erty Comparisons’, Artha Vijnana, XLVII(3–4): 223–58, 259–86, 287–328.
T

Government of India. 1993. Report of The Expert Group on Estimation of Proportion and
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Number of Poor, New Delhi, Perspective Planning Division, Planning Commission.

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Palmer-Jones, R.W. and K.K. Sen. 2001. ‘On India’s Poverty Puzzles and the Statistics of
Poverty’, Economic and Political Weekly, 36(3): 211–17.
———. 2003. ‘What Has Luck Got to Do with It? A Regional Analysis of Poverty and Agri-
cultural Growth in Rural India’, Journal of Development Studies, 40(1): 1–31.
———. 2006a. ‘Did Agricultural Growth Trickle Down in India? What do we Really-Really
Know?’ India Macroeconomics Annual, 126–167.
———. 2006b. ‘It’s Where You are that Matters; the Spatial Determinants of Rural Poverty
in India’, Agricultural Economics, 34(1): 1–14.
———. 2007. ‘Poverty Measurement, Poverty Lines and Consumer Price Indexes in India’,
A Critique Paper prepared for Conference on ‘Revisiting Poverty Issues: Measurement,
Identifications and Eradication Strategies’, Patna, 20–22 July.
Panagariya, A. 2008. India: the Emerging Giant. Oxford: Oxford University Press.

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294 „ Journal of South Asian Development 4:2 (2009): 283–320

Popli, G., A. Parikh and R.W. Palmer-Jones. 2005. ‘Are the 2000 Poverty Estimates for India
Artefact of Myth’, Economic and Political Weekly, 40(43): 4619–24.
Ravallion, M. 2003. ‘Measuring Aggregate Welfare in Developing Countries’, Review of
Economics and Statistics, 85(3): 645–52.
Tarrozi, A. 2004. Calculating Comparable Statistics from Incomparable Surveys, with an
Application to India. Durham: Duke University.

Reviewed by Richard Palmer-Jones, University of East Anglia, UK.

Dipak Mazumdar and Sandip Sarkar. 2008. Globalization, Labor Markets and In-
equality in India. New York: Routledge. 384 pp. Rs 170.00 (HB). ISBN 978-0-415-

SE
43611-3.

U
The role of labour markets for growth and poverty reduction is receiving renewed
attention, and this book provides further testimony to this revival. India, with a

L
IA
‘Hindu growth rate’ of 5 per cent or more over the last two decades, and with sub-
stantial poverty reduction (from 60 per cent in 1981 to 42 per cent in 2005), but
C
still harbouring the largest number of poor in any one country (roughly half a
ER

billion1), provides a fascinating case study. The increasing availability of empirical

material also calls for stock taking. This book is therefore well timed and provides a
M

welcome overview of some of the key issues on labour and poverty in India. Making
M

use of data on households, firms and labour regulations, it brings together a range
O

of findings on poverty, inequality and growth and relates them to the functioning
C

of labour markets. Striving for a broad overview, the authors discuss a wide range
R

of issues using mostly descriptive evidence or extensions of previous work. This

FO

sometimes comes at the expense of in-depth analysis, and the reader is at times left
wondering about the robustness of the results. The strength of this book therefore lies
in identifying and exploring hypotheses, rather than formally testing them. Notable
T
O

exceptions to this, and arguably the strongest parts of the book are Chapters 5
and 11. The first generates genuinely new insights on the differences in employment
N

performance across regions, and the latter, following a more descriptive approach,
enriches our understanding of the role of legislative regulations, and sheds more
light on results from earlier work in this area (for example, Besley and Burgess
2004). The book has, apart from the introduction, four parts: (a) trends in poverty,
inequality, employment and earnings; (b) regional dimensions; (c) employment
and earnings in the major sectors and (d) labour market institutions, followed by
an epilogue and a short conclusion. In what follows, we provide a short discussion
per section. The intended audience of this book are policy makers and analysts who
have a good understanding of economics.
 Book Reviews „ 295

In Part 1, the authors bring together key findings on growth, poverty and
inequality. Reproducing and extending some of the existing work (Deaton and
Dreze 2002), the first chapter (Chapter 2) presents an overview of what we know,
and provides a useful extension by considering town size to take the geographical
dimension into account. They find that large urban centres benefited more than
small towns, both in terms of growth and poverty reduction, in the first period
considered (1987–93), while it was the reverse in the second period (1993–9). The
authors argue that decentralisation and foreign direct investment (FDI) offer the
best explanation for this change over time (pp. 29–30), but unfortunately, this is
not tested formally. At times the relationships are given a causal interpretation
while it is unclear whether that is justified as some of the right hand side variables
are endogenous (for instance, the rate of urbanisation in the estimations presented

SE
in Table 2.7). The section would also have benefited from further analysis, by for
example looking at the linkages between the sectors where growth occurs and those

U
where the poor work. In Chapter 3, the authors then turn their attention to the
labour market, summarising the main trends in employment and earnings, and

L
IA
providing a good overview of the urbanisation of employment, the role of education
and the differences across sectors. Like before, more robust checks would have been
C
welcome in some places, while more discussion would have been warranted in others.
ER

For instance: the higher relative productivity of services relative to manufacturing

(Figure 3.1) remains a fascinating finding unique to India, but it receives little
M

attention. The many gender differences also deserve more attention. The authors
M

attribute these to institutional factors, but this would merit from more discussion
O

(is it norms, do regulations play a role?), in particular because women seem to be

C

withdrawing from the labour force (see Chapter 4). The major shortcoming of
this part of the book is, however, that it does not combine the analyses of labour,
R

growth and poverty. This, of course, is a challenge, because poverty is measured at

FO

the household level while labour outcomes are measured at the individual level,
but it is what is needed to gain further insight.
T

Part 2 focuses entirely on the regional dimension. The starting chapter (Chapter 5)
O

is probably the strongest part of the book and provides new and convincing evi-
N

dence of the lack of integration of regional labour markets, and the substantial
heterogeneity among them. Relying on a detailed and robust analysis, the authors
recommend that migration between states be encouraged. Chapter 6, analysing
poverty per region, revisits earlier work and inquires what factors other than initial
agricultural conditions explain the variation in poverty. Here again, the poverty
analysis remains separate from the labour analysis. It would also have been nice to
see more discussion on the challenges to identify some of the effects (for example,
‘other variables’ could be caused by the initial level).
In Part 3 the authors shift their attention to the sectors. Chapter 7 focuses on
agriculture, off farm work and rural poverty. In the first section the authors use the

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296 „ Journal of South Asian Development 4:2 (2009): 283–320

output elasticity of employment to assess labour market performance. This concept

can, however, be misleading and does not yield a clear interpretation without fur-
ther analysis. For instance, a relative high elasticity can mean high employment
or low productivity, or any combination of the two. The authors are aware of this,
but restrain from further analysis. Moving on to the topics of off farm work and
marginal farmers, the authors provide a nice overview of hypotheses that are highly
relevant to the Indian context. Again, there is rich information here and it would have
been nice to see a deeper and more robust analysis, which could also lead to firmer
conclusions, especially regarding cause and effect. In Chapter 8, the authors look
at the organised manufacturing sector, using employment elasticity as the central
concept for their analysis. This leads to some insights into the composition of the
industry, but remains at times open to (mis)interpretation. Chapter 9, discussing

SE
dualism in Indian manufacturing raises many interesting issues. Contrasting the
findings with those from other Asian countries, one of the main observations is

U
that the (employment) size distribution of firms is bi-modal, revealing that there is

L
a ‘missing middle’. Here, it would have been interesting to broaden the comparison
IA
beyond Asia as this is a common observation in other developing countries, for
example in a number of African countries (Bigsten and Soderbom 2006). In
C
Chapter 10, the authors focus on employment and earnings in the tertiary sector.
ER

A number of interesting findings emerge, and they point to fascinating themes

for future research. A key topic is the ‘missing middle’ and the related polarisation
M

of firm size, which touches on the fundamental issues of firm growth. In order
M

to understand why there is a missing middle, we need to know which small firms
O

have growth potential and which do not, which requires a detailed analysis of the
C

heterogeneity among small firms.

R

Part 4 focuses on labour market institutions, and Chapter 11 provides an excellent

FO

overview of legislation, enforcement and adjudication. Illustrating how a descriptive

approach can generate major insights, it provides convincing arguments that will
help redirect the policy debate. Currently, the choice available to policy makers is
T

usually portrayed as one of two extremes: provide strict and protective regulations
O

or obtain lawlessness and worker exploitation. But reality is more nuanced. And
N

as shown convincingly by the authors, the choice is rather between a status quo
of arcane regulations that do little to improve worker welfare—if only because
they are too complex to enforce—and building a new regulatory infrastructure
that allows labour markets to function better in order to increase job creation,
productivity and wages and improve work conditions. The question of regulation is
complemented by a discussion on whether public works offer a way forward in the
next chapter, Chapter 12. Providing a brief overview of public work programmes
and their achievements—including a summary of projected results of the National
Rural Employment Guarantee (NREG) from other works (Murgai and Ravallion
2005)—the authors conclude that most of the existing programmes have reached
 Book Reviews „ 297

less than what they aspired to, even though they have in general been well targeted.
The chapter also discusses pitfalls of providing social security in the ‘unorganised
sector’.
The book concludes with an epilogue and conclusion, but like in the introduction,
there is no real attempt to pull the key insights together, which leaves the reader to
his own device. The book also has a number of crucial typos that should have been
picked up2 and it would have been good to add a list of abbreviations (which are
idiosyncratic at times). The impression that some of the work remains unfinished
is further enhanced by the limited references to contemporary work on labour
markets, in or outside India, the absence of a discussion about data issues and
the missing references. Finally, the reader remains puzzled about the title of the
book: very little is said throughout about globalisation, with only the introduction

SE
devoting some attention to trade. A more appropriate title along the lines of ‘Labour,
Growth, Poverty, and Regulation in India’, would have directed expectations better.

U
Overall, however, this book contains a richness of ideas, generating many questions

L
for future research. Chapters 5 and 11 stand out for the depth of their analysis and
IA
make a substantial contribution in the field of labour market regulation.
C
ER

NOTES
M

1. Poverty is defined here as income below US$ 1.25 PPP 2005 using the updated PPP 2005
M

figures as in Chen, Ravallion and Sangraula (2008).

O

2. From printing ‘inverse U-Shaped’ instead of ‘U-shaped’ (p. 6), to ‘dependent variable’
instead of ‘independent variable’ (Table 2.7), to repeating exactly the same sentence a few
C

lines lower (p. 55), or misspelling the names of authors (Fields become Field on page 65;
R

Besley becomes Beasley on page 121), and so on.

FO

REFERENCES
T
O

Besley, Tim and Robin Burgess. 2004. ‘Can Labor Regulation Hinder Economic Performance?
N

Evidence from India’, Quarterly Journal of Economics, 119(1): 91–134.

Bigsten, A. and M. Soderbom. 2006. ‘What Have We Learned from a Decade of Manufacturing
Enterprise Surveys in Africa?’ World Bank Research Observer, 21(2), 241–65.
Chen, Shaohua, M. Ravallion and Prem Sangraula. 2008. ‘Dollar a Day Revisited’. World Bank
Policy Research Working Paper 4620.
Deaton, Angus and Jean Dreze. 2002. ‘Poverty and Inequality in India—A Re-examination’,
Economic and Political Weekly, 37: 3729–48.
Murgai, R. and M. Ravallion. 2005. ‘Is a Guaranteed Living Wage a Good Anti-poverty Policy’.
World Bank Policy Research Working Paper 3640.

Reviewed by Pieter Serneels, University of East Anglia, UK.

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298 „ Journal of South Asian Development 4:2 (2009): 283–320

Nivedita Menon and Aditya Nigam. 2007. Power and Contestation: India since 1989.
London: Zed Books. 219 pp. $9.95 (PB). ISBN 978-1-84277-815-9.

Nivedita Menon and Aditya Nigam’s book was published in the UK boasting
exceptional reviews from US-based political historians of South Asia. Intended as
an introduction to scholarship on Indian politics and history for a general reader-
ship, the book offers a lucid overview of the ‘internal conflicts’ and ‘logics’ that have
transformed post-colonial India. The choice of themes and emphasis presents, what
the authors call, a ‘new left perspective’ (p. 3) on contemporary Indian history: the
axis of Power in the book’s title is constituted by the forces of Nation and Capital
while the axis of Contestation is constituted by struggles for inclusion in or oppos-
ition to the nation and the spaces of capital.

SE
The years between 1989 and 1992 constitute, the authors decisively claim, a
‘ruptural moment in contemporary Indian history’ (p. 3). The overlap of key political

U
events, with social conflicts and broader economic transformations during this

L
period created, Menon and Nigam argue, a potent ‘Althusserian conjuncture’ (p. 4)
IA
that can now be said to have signified the shift from Nehruvian to post-Nehruvian
state. Their book identifies and analyses six key features of this conjuncture in depth.
C
First: the collapse of a Nehruvian consensus, and visions of an economically self
ER

reliant, secular and non-aligned polity. Second: the decline of the Indian Congress
Party’s control over central government and the emergence of coalition politics.
M

Third: the earnest introduction of pro-market economic policies. Fourth: the rapid
M

rise of the Hindu nationalist Bharatya Janata Party, new claims to political power
O

by the Hindu right, and a new phase of sectarian violence that marked a symbolic
C

end to secular nationalism. Fifth: the advent of new media technologies that shifted
R

the nature and the form of politics. And finally, sixth: the emergence of India’s new
FO

middle classes as a social and political subject. The book’s premise is that the con-
juncture of these different elements created a unique social and political moment
in India: a moment rife with possibility and dangers, and marked by struggle.
T

Chapter 1 explores the implementation of the Mandal Commission’s report

O

and the rise of Other Backward Castes on the political stage at both regional
N

and central level. Chapter 2 gives a familiar history of the BJP and the politics of
Hindutva. In both the authors reflect on the elite—upper caste and modernised
upper class—discourse of secular nationalism that in Nehruvian India effectively
excluded subaltern voices, just as it silenced majoritarian voices.
In Chapters three and four, Menon and Nigam introduce a number of analytical
devices that are of broader value for the critical south Asian scholar. Chapter 3 ad-
dresses the power of the Indian state to acquire private property for public use (the
power of eminent domain). Using statistics and reportage the authors assemble a
familiar list of mega-projects and urban clearances—with examples that include
the construction of dams along the Narmada river valley, the establishment of
special economic zones in Orissa and West Bengal, and the closure and relocation
 Book Reviews „ 299

of hazardous industries in Delhi—to show how the state’s commitment to

‘development’ has proven to be, in David Harvey’s phrase, a process of private
accumulation by dispossession. In Chapter 4 the authors introduce the phrase
‘economies of aspiration and desire’ (p. 86), providing a helpful language for theor-
ising the relationship between the market, cultures of consumption, the body and
personal projects of transformation.
Chapter 5 shifts ground to think about the terrain of progressive politics during
the 1990s and describes the challenges that social movements have posed to the insti-
tutionalised Left. Chapter 6 problematises the territorial and ideological integrity
of India, interweaving established history of struggles over Kashmir with material
from the north-east. Chapter 7 introduces a wider political economy by looking at
India’s bilateral relations in the region.

SE
These chapters offer an immensely readable synthesis of existing material, unit-
ing political economy and history with a critical sociology, while at the same time

U
making an original contribution to assessments of gain and loss in neo-liberal India.

L
The authors successfully create a critical space that both recognises how a con-
IA
juncture of social, economic and political processes ushered in an era of political
instability and violence but also brought about ‘immense liberatory possibilities’
C
(p. 83). One of the book’s major strengths—its accessibility as an introduction for
ER

students—is also its weakness. Some passages offer little more than good critical
journalism and leave the reader hoping that the authors produce an elaborated text
M

sometime in the future.

M

To the anthropologist, however, there remains a problematic absence at the heart

O

of the book. The authors fail to draw on a wide-ranging corpus of work in the social
C

anthropology of South Asia that might have validated their claims, enriched their
R

analyses, and introduced students to a different body of scholarship. One reason,

FO

perhaps, is that too few South Asianists among the trans-national community of
anthropologists reach an audience beyond their disciplinary sects. Another reason,
perhaps, is that the empirical work of anthropology disorients the meta-narratives
T

that drive this kind of writing. Menon and Nigam’s accounts of tribal populations,
O

slum dwellers and industrial workers confronted by the State and Capital reproduce
N

the portraits of Leftist journalism. Unarmed militant workers ‘face down the might
of the Indian State’ (p. 67) and the dispossessed show ‘a marked aversion for going
quietly into oblivion’ (p. 69). By contrast, the work of anthropologists in industrial
settings and social movements disorients these portraits of resistance with a more
nuanced sociology that sees ambivalence, ambiguity and consent rather than
straightforward opposition. Perhaps celebrating contestations to the power of capital
and nation with what the authors describe as ‘undaunted optimism’ (p. 181) is a
necessary political act, but it remains an ethnographically thin kind of praxis.

Reviewed by Jamie Cross, Department of Anthropology, National University of

Ireland, Maynooth.

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300 „ Journal of South Asian Development 4:2 (2009): 283–320

Mazhar Aziz. 2008. Military Control in Pakistan: The Parallel State. Oxon, UK:
Routledge. 144 pp. $39.95 (HB). ISBN 978-0-415-43743-1.

Academic works on Pakistan have once again become fashionable in the wake of
Pakistan’s central role in the War on Terror. In recent years, a number of works
on Pakistan have made their way into the academic world, including those by
Hassan Askari Rizvi, Stephen Cohen, Hassan Abbas, Hussain Haqqani and Ayesha
Siddiqa-Agha, amongst others. Most of these works have concentrated on Pakistan’s
political development, the tenuous relationship between civilian governments and
the military and the role of the military in governing the polity including the rise
of religious militancy and jihadi culture since the 1980s. The work under review
borders on the same wavelength as earlier works, concentrating on the role of the

SE
military in Pakistani politics.
The central hypothesis of the book is a simple one: military interventions in

U
Pakistan are not a response to political mismanagement and corruption on the part

L
of political elites. Rather, such interventions are geared towards the protection and
IA
extension of the institutional interests of the Army. The conventional understanding
posits the corruption of political elites as the prime cause of armed coups, but the
C
author purports to reject such a viewpoint and presents the military as an usurper
ER

of power. The role of the Army in the politics and political development of Pakistan
is formulated with reference to the theories of path dependency and historical
M

institutionalism.
M

Path dependency and historical institutionalism are construed as instrumental,

O

because military influence, once established, is relatively hard to roll back. Pakistan’s
C

history, since independence, has seen the bureaucratic–military establishment

R

assuming control of political affairs and governance, much to the dismay of parlia-
FO

mentarians and political leaders. The relative weakness of the latter meant that the
primacy of the bureaucracy and military was unchallenged, leaving a void from
which Pakistan has still not recovered. The ascendancy of the military has been ex-
T

plained with reference to Pakistan’s threat perceptions vis-à-vis India. The threat
O

perception is taken as an independent variable, which contributed to a rising defence

N

expenditure in which the military in Pakistan assumed a predominant position,

not only in defence related matters but also over political governance. Since the
military is taken as an institution and Pakistan’s political history is seen as such,
there is no room for analyses bordering on the role of individuals nor on ethnicity
or the ‘Punjabisation’ of the Army. The author correctly asserts that the military
acts as an institution and the argument relative to ‘ethnicity’ falls flat on the face
when one assesses the dismissal of Nawaz Sharif, a Punjabi, in 1999 by the Army
which coincidentally was headed by a Mohajir, Pervez Musharraf.
With regards to Pakistan’s threat perceptions vis-à-vis India, the author makes a
cardinal mistake. In explaining the objectivity of the threat perception, the author
alludes to the ‘policy makers’ who facing the threat from India geared the political
 Book Reviews „ 301

economy of the state towards defence and thus, strengthened the Army over the
political process. The question which arises from such an analysis is: who were the
‘policy makers’? The author presents ‘policy makers’ as if they existed independently
of the military and bureaucracy. The moot point is that the ‘policy makers’ were
the military generals who along with the bureaucratic establishment had assumed
a significant position in the decision-making circles soon after independence.
The Army was firmly entrenched in the Pakistani state by 1951 and influenced
the political process, including foreign relations, in a substantial manner. The
induction of Ayub Khan as the Minister of Defence in the ‘Cabinet of Talents’ in
1954 goes a long way to show that years before the Army coup came in 1958, the
relative balance of power in the policy-making circles had shifted in favour of the
bureaucratic-military establishment.

SE
The threat of India was generated by the same bureaucratic-military establish-
ment in order to justify their hold over the country. The defence pact with the US

U
in 1954 and Pakistan’s consequent joining of the Southeast Asia Treaty Organization

L
(SEATO) and the Central Treaty Organization (CENTO) proves that important
IA
decisions with respect to national security and strategy was not being taken by a band
C
of independent ‘policy makers’ which the author erroneously contends—rather, the
ER

bureaucratic-military establishment were constitutive of the ‘policy makers’ of the

newly independent country.
M

In the same vein, the author’s designation of the military as the ‘parallel state’
M

ignores a well established stream of thought in the social sciences which sees the
O

military and bureaucracy as constituting the state itself. The state, according to
C

historical sociologists such as Theda Skocpol, Charles Tilly and John Hall amongst
others comprises the institutions, such as the bureaucracy and military, which remain
R

constant and endure over a longer period of time as compared to governments. In

FO

the context of Pakistan, such a distinction is noteworthy because of the propensity

of the state (read: bureaucracy and military) to overthrow elected governments
T

and people’s representatives.

O

Moreover, the argument that the military justifies its assumption of power by
N

alluding to the chicanery and malice of politicians misses a key point. Military
takeovers do not preclude an analysis of the social forces which authenticate such
takeovers as legitimate. For example, the role of the PNA opposition in bringing
down Zulfiqar Ali Bhutto’s government is instrumental. Asghar Khan’s letter to
the Army asking for the military to intervene in order to save the political process
certainly did not bode well for the diminution of the role of the military in the
political process. Moreover, the same political actors are then instrumentalised
once the Army is in power as cronies who can serve the military junta. Similarly,
the large amount of support which Pervez Musharraf garnered after his military
coup of 1999 was legitimated by important political actors and most unfortunately,
by sections of the liberal intelligentsia.

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302 „ Journal of South Asian Development 4:2 (2009): 283–320

The book, though interesting, is replete with repetitions and the main text
inundated with quotations. Moreover, the central hypothesis is repeated quite
frequently as is the theory of path dependence and historical institutionalism.
Overall, the book will serve the students and researchers of political development
in Pakistan and the role of the military well.

Reviewed by Farhan Hanif Siddiqi, Department of International Relations, Uni-

versity of Karachi, Pakistan.

Santosh Mehrotra and Enrique Delamonica. 2007. Eliminating Human Poverty:

Macroeconomic and Social Policies for Equitable Growth, Comparative Research on

SE
Poverty (CROP) (ed.), London and New York: Zed Books. 432 pp. $38.85. ISBN
978 1 84277 772 5 (HB), and 978 1 84277 773 2 (PB).

U
L
With the arrival of the new millennium, almost inevitably, the issue of poverty came
IA
back to the development economics discussion agenda. Half a century earlier, the
C
old Kuznets inverted ‘U’ shaped curve explained that it was a matter of time before
ER

the poor started benefiting from economic growth as much as the non-poor. This
seems to be the base upon which the book builds its argument and proposes a
M

new emphasis on the provision of social infrastructure as a catalyst for effectively

M

fighting poverty.
O

This book fills the gap of linking the provision of basic household infrastructure
C

with broader and more established social policy such as the provision of education
and heath. This approach could prove to be especially useful for policy makers, as
R

it lays emphasis on practical aspects that are neither fully covered nor illustrated by
FO

academic research papers. Yet it presents a strong case for redirecting policy making
in favour of providing the basis upon which human capabilities are to develop.
T

The book is overall well presented. It comprises of nine chapters divided into
O

three main parts, and the introduction and conclusion. Part I deals with theoretical
N

approximations to macroeconomic policies intended to lessen the burden of poverty.

Part II goes a step further to analyse how far public expenditure has contributed
to the expansion of social services, essential for the welfare of poor households.
And finally, part III analyses ways of financing the provision of such basic social
services.
It seems difficult not to agree with one of the claims made right at the beginning
of the book, that

Given sufficient inputs for BSS (basic social services), the non-income dimen-
sions of poverty can be reduced without economic growth … However, in the absence
of sufficient investment in BSS, economic growth may not reduce the income or
 Book Reviews „ 303

non-income dimensions of poverty, primarily because the poor may be unable to

take advantage of market opportunities …(p. 4)

In other words, economic growth and the provision of basic social services (BSS)
do not have a symmetrical relationship in terms of poverty reduction.
Chapters two and three are dedicated to presenting the theoretical approach
with the aim of building an alternative perspective to social policy design. They
depart from the mainstream economics view of budgetary adjustment and struc-
tural reforms as the only solution for all kinds of economic crises that dominated
the developing world policy agenda from the early 1980s, in short, policies that
emerged from the so-called Washington consensus. They instead argue that market
dynamism is not necessarily efficient in making economies grow rather it makes

SE
economies profitable for international investors. The sources of growth, according
to the authors, are innovation and productivity which are seldom promoted in

U
periods of adjustment.

L
Chapter 2 puts together arguments that have been around for a while and
IA
builds an overall good critique of orthodox economics perspective. Perhaps the
C
strongest argument in building the case for an alternative approach is regarding
ER

privatisation. Mainstream economics strongly emphasises that by selling off state-

owned enterprises to private investors, markets would gain competitiveness and
M

hence consumers would benefit. In other words, privatising would lead to lower
M

prices. However, this rarely happens, and it is more frequent to find that state
O

monopolies turn into private monopolies, leaving consumers’ utility behind. The
C

alternative approach proposed emphasises the synergestic relationship between

technical (structural) change, poverty reduction, GNP per capita, expansion of
R

functionings, distribution of assets and social policies. Although the presentation

FO

is easy to follow, when it comes to country-specific characterisation by the end of

the chapter, it does this in a rather brief manner.
T

Although the book exemplifies specific country characterisations, we would only

O

refer to one that seems to embody the spirit of the argument. Cuba provides not only
N

a good case for exemplifying the point, but also introduces a political perspective in
the overall characterisation of that alternative approach. Cuban achievements with
regards to education, health and sanitation are beyond discussion. However, in the
case of Cuba joining trade normally, the discussion is not about special free trade
agreements, but only the end of the commercial embargo by the US, and hence an
expectation of both significant reduction in poverty as well as improvements in the
standard of living, perhaps comparable with industrialised countries. In the light of
this example, the case for a different approach to social policies would be stronger.
Chapter 7, where the role of government in providing basic social infrastructure
is discussed, presented a good opportunity to do so, but the authors mention it
only marginally.

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Public provision of basic social services is exhaustively yet efficiently presented in

chapters three to eight, occupying almost half the edition. In particular, Chapter 4
deals with adequacy, or more precisely, inadequacy in public spending with em-
phasis on education and health services. Unsurprisingly, one of the findings is that
developing countries need to push up their budgets in order to impact on other
social variables such as child mortality. While there is much to criticise in the
data and/or econometrics referred to by the authors, for reasons of space it would
only be worth mentioning that the cross-country data brings no clarity in terms
of causality of explanation. For example, the fact that developed countries spend
proportionally more on health and education does not imply that because of this,
these countries have lower child mortality rates. Conversely, spending less in those
areas does not necessarily mean higher rates of child mortality. It is a matter of

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efficacy/efficiency of spending and overall institutional arrangement that is not
included in these models.

U
Chapter 5 puts on the table the discussion of who gets what from health and edu-

L
cation spending. A common characteristic in developing countries is that poverty is
IA
one of the driving forces preventing children from attending school. With a degree
C
of variation, households’ economic location, gender and ethnicity also influence
ER

school attendance. This finding is not new, but echoes what is already known.
In terms of reorienting public spending, out of two mechanisms allocative effici-
M

ency is suggested as the most effective policy to reach the poorest (Chapter 6). This
M

implies increasing the share of public spending on primary education. The other
O

area of manoeuvre is reaching technical efficiency to find adequate balance between

C

capital expenditure and labour and non-labour spending. Specifically, the authors
propose differentiating between teachers with higher qualifications and spending
R

more on providing teaching materials to children. These two mechanisms apply to

FO

other areas such as water provision, reproductive health and other issues as well.
The main argument then is one of managerial efficiency of resources and planning
T

as the best strategy for improving outcomes in developing countries.

O

The last part of the book is dedicated to presenting options for financing of basic
N

infrastructure. Perhaps Chapter 8 (about public/private provision complementarity),

which belongs to Part II and is dedicated to analysis of public expenditure on basic
social services, would better fit in this last part of the book. Choices policy makers
have are limited, either augmenting taxation or accessing aid to provide for extra
funds.
All in all, this book makes a good case for the inclusion of social basic infra-
structure at the centre of the development agenda. More focus on context-specific
country analyses could have served to further strengthen the arguments presented
here.

Reviewed by Baruch Ramírez-Rodríguez, University of East Anglia, UK.

 Book Reviews „ 305

Partha S. Ghosh. 2007. The Politics of Personal Law in South Asia: Identity, Nationalism
and the Uniform Civil Code. London: Routledge. 339 pp. Rs 695 (HB). ISBN 0-415-
44544-3.

This book is concerned with the continuing debate as to whether there should be a
Uniform Civil Code (UCC) for India. This debate began during the drafting stages
of the Indian Constitution and picked up speed in the 1980s and 1990s, when it was
appropriated for various political ends. In the introduction, Ghosh firmly states that
it is rarely acknowledged that the UCC is both a sociological and a jurisprudential
issue. Taking his methodological standpoint from the discipline of Critical Legal
Studies, he points out that all law is by nature political, and therefore subjective,
hence it quickly follows that identity, ethnicity, religion and other such markers are

SE
all inherently political as well. While this statement has some value on its own, it
excludes an appeal to historical arguments. This proves a major analytical drawback

U
for a book that aims to trace the past of both personal law and the debate surrounding

L
it in South Asia—historical arguments are difficult to avoid in such a context. In
IA
the first chapter, for example, the author excludes various characteristics (such as
physical disabilities) from conferring special treatment on groups as minorities
C
because they ‘do not meet the historical sense of minority status’ (p. 9). Given the
ER

previous statements in the opening chapter, this is a surprising argument.

The first chapter is dedicated to an overview of the various issues and concepts
M

Ghosh intends to discuss. In essence, the debate centres around whether there should
M

be a centralised view of the legal system in a particular society or a decentralised

O

one, and whether codification of the variety of existing personal laws is conducive
C

or actually detrimental to the formation of a UCC—the latter would be the case if

R

codification would cause communal identities to rigidify rather than to integrate

FO

them into the nation as a whole. These two larger aspects of the desirability of a UCC
imply other issues, such as those of centrality versus plurality of law; of individual
versus group rights; the territorial identity of a group; and the question of women’s
T

rights. This subset of questions is further treated in the second chapter, which is
O

devoted solely to the evolution of the Indian discourse in the sense that it tracks the
N

evolution of law itself in India. The third chapter then deals with the politics of the
discourse on the uniform civil code by an extensive treatment of Indian personal
law. The author clearly intends to supply the reader with all the tools needed to
properly contextualise the issue. The consecutive chapters therefore broaden the
field to take in tribal laws as well as the larger South Asian context, and finally a
more global or, if you will, transnational perspective. Importantly, the Maldives is
taken as an example of a homogenous state in an inherently heterogeneous region,
and the treatment of its state laws provides an interesting comparison.
In addition, the author refers to other legal systems throughout the book, most
notably the Common Law of Great Britain and Roman Law (as the ancestor to many
continental European legal systems). It is here, however, that some unfortunate

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306 „ Journal of South Asian Development 4:2 (2009): 283–320

comparisons are made, some of which complicate more than they clarify. For
instance, it is suggested in the first chapter that ‘India inherited Roman law twice’,
because ‘the South Asian legal systems are largely borrowed from England’ (p. 6).
The paragraph suggests that Roman Law was case-based, and that British Law draws
from it. However, on the next page, Roman Law is qualified as a civil law system.
The difference between common and civil law systems thus remains unclear to
the general reader. Another surprising mishap occurs later in the book, when the
dissolubility of marriage is discussed. After presenting the differences between—
generally speaking—the Muslim and Hindu visions on the issue and hence their
importance to the discourse around the UCC, it is unfortunate that this important
issue becomes obfuscated by the following statement: ‘After a thousand years of the
Islamic innovation of contractual marriage, the idea spread to Europe and from

SE
there to European colonies’ (p. 224). The author can hardly suggest that marriage
was not a contract under Roman Law, or that in Europe at large, marriages were not

U
contractual until the seventeenth century. Such inaccuracies detract from the larger

L
argument. IA
The fourth chapter entitled ‘On the Fringe: The Tribal Laws’ is perhaps the best
C
part of the book. First, this issue is rarely discussed within the ambit of academic
ER

treatment of the discourse on the UCC. Second, the issue of tribal law is frequently
ignored in the political realm, which tends to focus more on communal issues
M

within the UCC context. The author makes a convincing argument as to why tri-
M

bal law should be an inherent part of the debate: its existence sheds light on the
O

plurality of legal systems in the region, on the coexistence of state and non-state
C

legal structures, as well as on the issue of national integration. By taking tribal law
into account, the debate is greatly enriched. Moreover, Ghosh does not fail to high-
R

light the methodological problem of addressing ‘tribes’ as one single category, and
FO

he emphasises the high degree of diversity in customary laws. Yet the chapter falls
a little short in its treatment of the ‘strengths of the traditional system’ (pp. 133–4).
T

In applauding the lack of forums for redress, the focus on the concept of restitu-
O

tion, the ‘accessible’ village court without high legal fees and travelling expenses,
N

and the role of ceremonial gifts and community feasts, the analysis is reminiscent
of the romantic preconceptions of classical anthropology and moves away from its
initial intentions. Nevertheless, the author successfully uses the issue of tribal laws
as a prism for the larger questions at hand, which gives the chapter its important
place in the book:

[S]ocial relationships, such as marriages, may continue to be governed by cus-

tomary laws but economic relationships will be increasingly governed by private
property considerations and contractual obligations. How to peacefully manage
this transition is the greatest challenge for the tribal elites […] as well as for the
Indian State. (p. 149)
 Book Reviews „ 307

In the end, this book attempts to weave together different strands in the debate, to
provide a ‘holistic’ political analysis. The author reiterates the question, whether a
UCC would contribute to or obstruct the process of nation building, and offers some
normative suggestions that take into account their political feasibility. As such, the
conclusion is almost necessarily open-ended. As Ghosh remarks at various points
in the book, the customary laws within a community (as it would be defined from
the centre) are highly pluralistic and frequently vary from region to region, because
a given set of laws is adapted to particular (regional) circumstances at any given
time. Therefore, neither a codification from the perspective of religious scriptures,
nor from the perspective of a community in a holistic definition, would satisfy. So,
according to Ghosh, a much more comprehensive process of codification is necessary
as a step towards forming a humane and gender-just UCC. Such a process would

SE
be in vital need both of networking at the grassroots level and taking into account
movements of reform, such as gender-based activism—which, again, involves

U
many political pitfalls. The book concludes that the experiment of the Special

L
Marriage Act (1954) should be replicated where possible. It advocates that secular
IA
legislation should be as a corrective to the constrictions of social structures and as
a measure towards free citizenship in a modern state. The concluding chapter is
C
well balanced and provides an excellent overview of the most poignant issues and
ER

the political hazards involved. It is in this chapter that the book comes together as
a real contribution to the current discourse on the UCC.
M
M

Reviewed by Carolien Stolte, Leiden University, The Netherlands.

O
C
R

K.S. Chalam. 2007. Caste-based Reservations and Human Development in India.

FO

India: Sage Publications. 210 pp. Rs 275. ISBN 978-0-7619-3581-0.

S.M. Michael (ed.). 2007. Dalits in Modern India: Vision and Values. India: Sage
Publications. 369 pp. Rs 395. ISBN 978-0-7619-3571-1.
T
O

Sage India has brought out two books on the status of Dalits, the politically correct
N

word to describe the lower castes of India—that segment of population which is in

a majority in terms of numbers, but in a minority in terms of sharing the economic
fruits of development and the Indian political and social space. The first book deals
with the reasons behind the Indian government’s policy of caste-based reservation’s
failure to uplift the condition of the Dalits as envisaged. The second throws light
on the Dalit perspective of caste-based discrimination against them throughout
Indian history—ancient, medieval and modern.
It would not be a hyperbole to say that caste is central to Indian existence and
yet no other word makes Indians go into collective self-denial than caste. Any
development—both the verb and noun—is seen in relation to caste, and more often
than not, the exercise is on a sub-conscious level. So much so, modernity, too, is

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308 „ Journal of South Asian Development 4:2 (2009): 283–320

naively measured commonly in terms of caste. It is easy to come across analyses, to

wit: ‘I have dropped my surname as I do not believe in caste’ or ‘Inter-caste marriages
are popular in our town’ or ‘Two lower-caste colleagues of mine also got pro-
motions’ or, as in the case of the recently held general elections, the media’s assertive
explanation for the ruling Congress party returning a stellar performance in the
northern state of Uttar Pradesh for the first time in over a decade: ‘[S]urprisingly, the
party got support from a sizeable section of the dalits, upper castes and Muslims.’
Well into the first decade of the new century, India is today seen as developing into
a powerful economic force with a market next only to China’s in terms of size, and a
diaspora spreading across the globe. Indian cities and towns and villages are bursting
with economic activity—every street boasts of a millionaire. The universities are
churning out professionals more than the national and even international job market

SE
can absorb, and one out of every three top CEOs in the world is of Indian-origin.
A noticeable section of global tourists are Indian. A common complaint heard in

U
the duty-free lounges of international airports just about sums up ‘modern’ India:

L
‘These days it is so difficult buying gifts for relatives in India because everything
on display here is available back home.’
IA
For those who script such a description of India, whether most Western analysts
C
or even that mass of Indians which is at the crest of the economic wave and considers
ER

itself ‘liberal’, the ‘other’ India does not exist and even if it does, it is something to be
forgotten as a distant, bad memory. Yet, that ‘other’ India co-exists with the ‘modern’
M

India where lopsided development, partisan politics and social inequalities are the
M

glaring outcomes of a society, and polity, deeply influenced by the caste system.
O

In this context, a small, 210-page book by noted Indian economist K.S. Chalam,
C

Caste-based Reservations and Human Development in India, is worth a read. The

R

title is self-explanatory. Where it is quite different from similar works is how it deals
FO

with the subject of caste. It does not pre-suppose that the caste system is either
bad or good. It is not moralistic in terms of calling for a movement to abolish the
system. Instead, it is a truthful present-mortem of how exactly the system thwarts
T

development making the reader wonder at the end of the book whether or how
O

economic progress has freed India from the shackles of caste.

N

The author analyses the impact of the caste system in terms of the Indian gov-
ernment’s aim to achieve social equality with the help of caste-based reservations.
His argument is based on the premise that the caste hierarchy has helped the upper
castes, the ‘haves’ reap much of the economic benefits of progress in relation to the
lower castes, the ‘have-nots’. This leads to his second premise that the clamour of
the have-nots for their rights and the counter of the haves to protect their space has
led to social chaos that diminishes the already lopsided process of development.
Chalam tries to understand caste in its relation to economic power. The central
question is: ‘Our concern here is to examine to what extent caste system as a power
structure influenced the base and means of economic power in India?’ (p. 28). He
delves into the history of the caste system to explain how caste hierarchy came
 Book Reviews „ 309

into being with those called the forward castes determining social equations. He
summarises the strengthening of the inequality among castes during the British
rule, which saw the emergence of a relationship between the Colonials and the
upper castes, bonded by a common currency: economic power. The author traces
the cause of the continuing social backwardness of the lower castes to their lack of
education; in the case of the educated, to their lack of economic power; and in the
case of the educated and economically sound, to the lack of political power.
Reviewing the age-old debate in India about the relation between caste and
class, Chalam reflects on the confusion among economists and sociologists on
how to distinguish between the two. To illustrate his analysis: in caste terms, an
uneducated person belonging to an economically dominant forward caste may still
be economically powerful by dint of his or her association with that caste. In class

SE
terms, within the same, economically dominant forward caste, an uneducated person
may be economically less powerful than an educated person of that caste. And since

U
an educated person from an economically weak lower caste is not economically

L
liberated just by being educated, it is assumed, in class terms, that uneducated for-
IA
ward caste person and the educated lower caste person fall in the same category of
economic backwardness even though they belong to separate castes.
C
The author does not delve much into the status of the intermediate castes— those
ER

which are between the forward and lower castes—because he is focused on the lack
of development among the lowest castes, which comprise a majority of the Indian
M

population. He refers at length to the programmes of the Indian government to

M

uplift these castes, again, focusing most on the policy of caste-based reservations
O

to achieve that goal. He comes up with the government’s own statistics which say
C

that the progress over all these years has been ineffective and slow.
R

Analysing the reasons, Chalam understands that the primary reason is political
FO

power being in the hands of the economically dominant forward castes in a country
whose Constitution does not distinguish between castes. He sees the influence of
the caste system in the cycle of social mobility where, as has been the case in some
T

states of India, the intermediate castes displaced the forward castes as the politically
O

dominant group by dint of economic progress over the years, but soon co-opted
N

the forward castes’ principles of power consolidation to retain their domination.

In some other states, the author notices the lowest castes—called Dalits—use the
same strategy as the intermediate castes to topple them from power and assume
the same role as the forward castes.
With the help of specific case studies, the author establishes that the caste-
influenced upward mobility cycle continues to deny the benefits of reservation
to the sections it was intended for and calls for a radical change of policy, from
caste-based reservations to proportional representation of all castes in all spheres
of economic activity for real development.
It is understandable that the author’s specific focus on the policy of reservation
for the lower castes does not allow him to deal with the social dangers the caste

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310 „ Journal of South Asian Development 4:2 (2009): 283–320

system has mothered and which are eating into the country’s social fabric and its
political stability, gender discrimination, for example. Unwanted girls continue to
get killed after birth, newly wed wives are burnt for dowry and educated women are
still apprehensive of their future, irrespective of whether they belong to a forward
caste or a lower caste.
The second book is a fast-paced narrative of India’s caste system with reference
to the lowest castes, the Dalits and the tribals. It has a positive attitude in that it lays
stress on the continuing efforts of the oppressed castes to emancipate themselves
from caste orthodoxy. Edited by S.M. Michael, a noted sociologist who is also a
consultant to the Vatican’s Pontifical council for Inter-Religious Dialogue, the book
has contributions from eminent Indian academics from fields such as sociology,
anthropology, religious studies and economics.

SE
Michael does not shy away from using the scalpel ruthlessly in exposing the caste
system in India for what it really is: a tool of oppression. So do the contributors,

U
as they peel the veneer of sophistication to expose Hindu bigotry that has per-

L
petrated caste hierarchy to the extent of treating the lower castes as untouchables
IA
for centuries.
C
The starting point of the book is summed up in an assertion by modern Indian
ER

thinker and the man who shaped the Indian Constitution, Dr. B.R. Ambedkar, as
quoted in Chapter 7 (‘Liberation Movements in Comparative Perspective: Dalit
M

Indians and Black Americans’, K.P. Singh): ‘To untouchables, Hinduism is a veritable
M

chamber of horrors. The iron law of caste, the heartless law of Karma and sense-
O

less law of status by birth are veritable instruments of torture which Hinduism has
C

forged against the untouchable’ (p. 169).

Armed with critical discourse, the initial chapters take a look at the birth of
R

the caste system, its effervescence in the Vedic age, the initial challenges to the
FO

Brahminic system in the era of the Upanishads, early rebellions against the Hindu
caste hierarchy which gave birth to religions like Buddhism and Sikhism, and later
T

ones like the Bhakti movement, the resurrection of the forward castes’ monopoly on
O

assets and practices during the British rule, the era of new political consciousness
N

in which leaders like Jyotiba Phule and B.R. Ambedkar launched Dalit rights move-
ments, and the current economic condition of the Dalits.
In the larger context, it is an attempt to put in the correct historical perspective
the ‘Dalit vision of Indian society’, given the distorted version of the dominant
caste groups. Here, the book is embellished by a critique of works not only by
Indian authors like M.S.A. Rao and M.N. Srinivas, but Western academics like
Louis Dumont and Owen M. Lynch, for a better understanding of the layers of
interpretation that seeped into Hindu texts to uphold caste hierarchy in terms
of distancing the lower castes from any kind of societal involvement. The book
notes in detail the attempts by Dalit thinkers and leaders to end, or reverse, the
process of discrimination at various periods of time, from the post-Vedic to the
 Book Reviews „ 311

modern era. An attempt is made to bring an international perspective to the Dalit

movements through a comparative analysis of such efforts with those of the African
Americans.
The concluding chapters look at the present status of the Dalits, no longer
untouchables but still at the lower end of the social, political and economic peck-
ing order. The contributing authors analyse the various Dalit empowerment pro-
grammes of the Indian government to conclude that the march of the Dalits to their
goal is far from over until their upward social mobility is recognised as a national
goal and not just that of the oppressed segment of the society.
The book does not go into the specifics of modern-day Dalit politics which is
characterised by Dalit leaders managing to come to even political power in some
Indian states and once consolidating that power, treating the Dalit masses merely

SE
as vote banks, as was the case when the forward castes were the dominant group.
As a result, the Dalit movement as such is threatened by the politics of domination

U
which has seen merely one social group replacing another at the top of the hierarchy,

L
without any attitudinal changes the movement was originally launched to achieve.
IA
This, in turn, has the potential to fragment the Dalit segment, making it less shrill
as a political force. A small reflection of this can be found in the results of the
C
just-concluded Indian general elections which saw established political parties
ER

representing the Dalits and other underprivileged castes losing out to ‘traditional’
and ‘hierarchical’ national parties.
M
M

Reviewed by Venkata Vemuri, a senior journalist from India currently doing his
O

Ph.D. at Bournemouth University, UK.

C
R
FO

Ramaswamy R. Iyer. 2007. Towards Water Wisdom: Limits, Justice, Harmony. New
Delhi: Sage Publications. 271 pp. Rs 350. ISBN 978-0-7619-3585-8
T

In this book, Ramaswamy aims, in his own words, not to offer new knowledge or
O

research findings, but to present the reader with the results of his own hard sus-
N

tained thinking. His reasoning proves to be remarkably logical and coherent, based
as it is on Iyer’s years of experience working within government, in research and
policy, and with civil society, all of which give him the authority required to qualify
his book’s stance. This book is a sequel to the author’s first, Water: Perspectives,
Issues, Concerns, 2003, and as such provides updates on many of the long-running
disputes surrounding water resources in India; notably those relating to rivers and
dams. The book is also a plea for an urgent rethink by society on water resources
management.
Towards Water Wisdom addresses several issues—perceived and real water crises,
water-related conflicts, laws and policies, international concerns—and comments
on the way various societal groups define such problems and respond to them. In its

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312 „ Journal of South Asian Development 4:2 (2009): 283–320

later sections, the book’s arguments are drawn together and placed within the global
scenario but without explicitly critiquing the capitalist philosophy guiding so much
of the ‘development’ that we have experienced. Although evidently disapproving of
the dominant paradigm guiding development, Iyer eludes that other philosophies
too advocate the types of unsustainable, inequitable development that we witness.
This book fills a gap in that it is an informative and easy read, written by an author
qualified and experienced enough to know the reality of the water scenario, and
bold enough to critique the various alternative positions.
In the first section of the book, Iyer seeks to aid our understanding of the
water crisis. He outlines the mainstream view of engineers, bureaucrats and
economists who believe the problem lies in water availability, and that supply-
side responses—including water markets and public–private partnerships (or

SE
privatisation)—will remedy this. Iyer himself, however, views that the crisis is due
to gross mismanagement. He then goes on to present a bleak picture of the Indian

U
water scene, by discussing, one by one, the failures in water management: in floods,

L
water scarcity, the implicit subsidisation of water supply for the urban wealthy,
IA
pollution of rivers and aquifers, groundwater exploitation and failures in irrigation
efficiency and pricing. After dismissing the new, perhaps fashionable, concept of
C
water governance, he briefly examines the politicisation of water, and the history
ER

of thinking in water, that is, engineering, supply-side irrigation, before examining

the question of demand, concluding that what we have are crises, not a crisis, and
M

that these crises ultimately stem from a lack of understanding. To back up this
M

point, Iyer critiques at length the concept of the ‘inter-linking of rivers’ project as
O

proposed by the Indian government in 2002.

C

In section two, Iyer seeks to re-examine and understand river water disputes.
R

He examines the Indus treaty, the Baglihar project, the Cauvery dispute and the
FO

recent instance in the Punjab in which the government passed an Act terminating
past agreements and accords over river waters. Reflecting on these up-to-date case
studies and others, he considers the ‘politicisation’ of water—enmeshed in party and
T

electoral politics—as presenting a serious problem for the resolution of conflicts:

O

How much water, Iyer asks, do the parties in question really need?
N

Other water conflicts are examined in section three, including case studies of the
Narmada Sardar Sarovar Project and the Plachimada (Kerala) Coca-Cola Company
operations. In the Narmada case, Iyer relates how in May 2006, learned judges of
India’s Supreme Court, in one stroke, de-linked the construction of the dam from
the rehabilitation of the project-affected peoples: although this Order itself appears
to be illegal and unjust, technically at least, the injustices and illegalities which took
place before the Court’s Order of 8 May 2006 from that day became legitimate.
In support of the people’s movement, the Narmada Bachao Andolan (NBA), Iyer
stresses the limitations of representative parliamentary democracy and hence the
necessity of such civil society initiatives. As an example, he mentions the fast by three
members of the NBA in protest against failures in rehabilitation, and the retaliatory
 Book Reviews „ 313

fast of the Chief Minister of Gujarat, Narendra Modi. To Iyer the counter-fast was
wholly inappropriate; for without remedying the failures or showing that the NBA
members’ fast was based upon wrong facts, Modi’s fast became a fast for injustice.
On the Coca-Cola case, Iyer frames his argument from the perspective that Coca-
Cola does not quench people’s thirst and is thus not meeting any basic need but is
merely selling a commodity. On privatisation, he considers that water should not
be treated like other economic goods, that is soap, fertiliser, steel, for we cannot do
without water or look for substitutes. Water needs to be regulated by the state and
not left to the market, and profiteering from water and property rights to water are
undesirable. The theory that some people should be sacrificed for the development
of others is wholly rejected.
Section four discusses India’s legal inadequacies on water, starting with the

SE
colonial period and the formulation of India’s Constitution on independence. The
Constitution failed to explicitly mention groundwater such that to this day rights

U
to groundwater are linked to landownership, which has led to the grave exploitation

L
of this centuries-old resource. The state claims ownership and control of all surface
IA
water, such that it may and sometimes does consider illegal the progressive work of
some civil society organisations: the Rajasthan State Government’s objection to the
C
NGO Tarun Bharat Sangh’s water harvesting work is presented as an example. Three
ER

recent, central policy documents are then reviewed—the National Water Policy 2002,
the National Rehabilitation Policy 2003, and the Draft National Environment Policy
M

2004 (passed in 2006)—and are all found to be unsatisfactory. To Iyer, the NWP
M

2002’s primary concern appears to be in favour of big projects and private sector
O

investment, and overall the document is found to be incoherent. The NEP 2004–6
C

is perceived to turn on the head ideas such as ‘affluence leads to pollution’ and ‘the
R

polluter should pay’; from an economic perspective it postulates that ‘poverty is the
FO

greatest polluter’ and advocates an ‘if you pay you can pollute’ style approach. Iyer
favours a National Water Law advocating the maximum possible decentralisation
of water control and decision-making.
T

Section five begins by examining national perspectives in India’s neighbouring

O

countries: Pakistan, Nepal, Bhutan and Bangladesh. Generally speaking, these coun-
N

tries’ governments share with India their support for big supply-side projects; partly
a result of neo-liberal economics and its failure to place any substantial value on the
environment. The discussion again reverts to politics in locating the origins of water
disputes, and regional rather than national or bilateral approaches to the solving of
water problems are advocated. A critique of several international ideas is then put
forward: Iyer finds ‘water wars’ unlikely; the idea of water as an ‘economic good’
unhelpful; ‘IWRM’ to be in need of serious questioning; ‘environmental flows’ as a
perverse reversal of the fact that we receive water from nature and so cannot presume
to allocate water to nature—‘minimum flows’ sanction ‘maximum abstraction’;
the idea of ‘virtual water’ as a tool being used to persuade developing countries to
extol markets and to import food rather than to focus on domestic production; and

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314 „ Journal of South Asian Development 4:2 (2009): 283–320

‘public–private partnership’ as a term useful for minimising negative responses to

water’s privatisation (without real partnership). Examining a recent thesis by Shah
and Koppen, Iyer questions their apparent approval of borewells as ‘local, innovative
responses’ to water scarcity, for the depletion of India’s groundwater is now taking
place at an alarming rate. Rather than passively accepting reality, Iyer advocates the
restraining of ‘demand’—which he considers to be ‘greed’ in Gandhi’s language.
In the final section, Iyer draws together his arguments, finding hope in the many
examples of civil society water initiatives across India. He presents his own ‘water
declaration’, which makes clear the need for more social science contributions to
the discipline and the bringing about of necessary changes in water law amongst
others. Restraining demand for more water is considered to be the greatest chal-
lenge for a wiser water management—difficult because of the wider paradigm of

SE
mainstream ‘development’ and humanity’s servitude to, rather than mastership of,
technology.

U
Towards Water Wisdom is appropriately easy to read for its message is directed

L
to all members of society and not solely those in positions of authority or power.
IA
Though focussed upon India and South Asia, the book’s case studies are of global
relevance and significance. Some may criticise the author for his dissent from the
C
mainstream perspectives on development or for some of his opinions which he
ER

himself admits to be partially naïve; however, Ramaswamy Iyer’s message is wholly

positive and constructive, and supportive towards the poor and the environment. To
M

this end, this philosophical text is an important contribution to the global struggle
M

for a wiser management of our most vital resource.

O
C

Reviewed by Joe Hill, University of East Anglia, UK.

R
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S. Mahendra Dev. 2008. Inclusive Growth in India: Agriculture, Poverty and Human
Development. New Delhi: Oxford University Press. 399 pp. Rs 1,150 (HB). ISBN
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019569190-3.
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Recording an average GDP growth rate of 7 per cent per annum, in the past de-
cade, India has emerged as the poster child for economic growth along with its
formidable neighbour to the north. Yet unlike China, India has a strong democratic
tradition—one which has demanded that government policy includes social
safety nets to aid struggling members of the population. In this book, the author
emphasises that this chapter in India’s economic history requires a more active
commitment to inclusive economic growth. A ‘people-centric’ approach to policy
making is necessary, involving the restructuring of social protection programmes
as well as the implementation of pro-poor policies at the all-India level. The book is a
collection of policy-oriented essays written by Dev and is divided into four sections:
 Book Reviews „ 315

agricultural performance and policies, poverty and right to food, employment

and social security, and human development and regional disparities. By using the
inclusive approach and contextualising his recommendations with respect to the
Eleventh Five Year Plan, Dev ensures that this volume is both cohesive and practically
relevant. The analysis covers a wide range of topics and recommendations; more
than can be evaluated in a single review. In the interest of brevity, the author’s
evaluation of regional disparities, social security for unorganised workers and the
Millennium Development Goals have not been discussed here.
Chapter 1 presents the key assumptions underlying Dev’s approach: (a) explicit
pro-poor interventions more effectively reduce poverty than social protection pro-
grammes, and (b) growth and equity are complementary phenomena. Regarding
the former, Dev argues that explicit policy interventions aimed at generating rural

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non-farm employment, for example, would not only induce growth, but would
also help the poor escape low productivity sectors. Regarding the latter, rather

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than following the Kuznets curve of development allowing inequalities to worsen

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before being addressed, the inclusive approach requires pursuing growth and equity
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simultaneously such that gains are shared by all. In the following chapters, Dev
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shows that this is in India’s best economic interest and may be accomplished with
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employment-generating interventions which reduce inequalities while boosting

long-term growth. As further justification for his work, Dev notes that although
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India’s macroeconomic indicators tell a story of a country on the fast track to eco-
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nomic development, other indicators reveal slow progress in education and low
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quality of employment growth. Such problems persist because economic growth

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has been restricted to individuals working in services, the IT industry, finance and
related sectors. Dev is no populist: his viewpoint is motivated by the belief that
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if these problems are not addressed, they will have real adverse effects on India’s
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long-term growth prospects.

The most innovative analysis is found in the section on agriculture which begins
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with a startling fact: accounting for only 25 per cent of GDP, agriculture employs
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57 per cent of India’s total workforce. And between 1961 and 2004–5, the share
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of agriculture in GDP declined by more than 30 per cent whereas employment in

agriculture declined by less than 20 per cent. This implies that the GDP per capita
in agriculture in 2004–5 was only 25 per cent of its level elsewhere in the economy,
down from the 1961 figure of 46 per cent. Thus, increasing the productivity of
agricultural labour should be a primary goal of policy making. Typically, this is
accomplished by increasing land productivity or decreasing the land–man ratio.
Referring to the second option, Dev suggests reducing the amount of labour
employed in agriculture by encouraging diversification to other non-agricultural
sectors. He adds that job creation should be focused in rural areas where the majority
of low productivity agricultural labourers are located.

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316 „ Journal of South Asian Development 4:2 (2009): 283–320

Inefficiencies in India’s agricultural market (such as minimum support prices

and inefficient distribution) have prevented market liberalisation policies from
enabling agricultural growth close to the 4 per cent level which Dev suggests is
necessary for sufficiently equitable growth. Purely market-based mechanisms
will not solve India’s agricultural problems: public investment is the key. The
argument that reducing protection to industry and liberalising trade improves
the terms of trade for agriculture cannot be blindly applied to the developing
world. Inadequate infrastructure in developing countries often prevents producers
from taking advantage of favourable terms of trade. Nor does private credit and
investment necessarily flow to the rural areas, leaving a significant investment
gap. So governments of these nations must focus on providing the necessary basic
infrastructure if terms of trade effects are to manifest themselves and the benefits

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of liberalisation accrue to a wider population. For example, although the author
agrees that farm-related electricity subsidies are inefficient, he cautions that simply

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removing them may actually worsen the farmer’s situation. If delivery systems are

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not simultaneously improved, farmers end up paying higher prices for inefficient
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services characterised by erratic supply and voltage fluctuations.
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In ‘Right to Food’ Dev demonstrates the importance of looking beyond income
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when examining poverty. The intriguing aspect of this section is that it is motivated
less by economics and more by a concern that even when there is plenty, people
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go hungry. Post-reform liberalisation has been a double-edged sword, both raising

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the price farmers receive for their goods and increasing the net cost of living for
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the majority. Higher prices hurt net purchasers of goods, which includes all urban
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households as well as 50 per cent of rural households, leaving only 50 per cent
of rural households to potentially benefit. Not only do the poor lack purchasing
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power, but they also lack access to food due to inequalities built into food distribu-
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tion systems. Dev mentions the Public Distribution System, which is the largest
subsidised food distribution programme in the world but has been plagued by
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leakages to the open market, corruption and inadequate distribution channels. A

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rights-based approach to food security could remedy the situation by demanding

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transparency, accountability, equity and non-discrimination in food provision and

requiring institutions to eradicate exclusionary practices. But the ultimate success
of a rights-based approach presupposes the existence of a functional democracy.
Whether India’s government fits such a description is a question that the author
fails to explore.
India’s workforce will increase from 58 per cent of the population in 2001 to 63 per
cent in 2011: a fact which could lead to an unprecedented rise in unemployment and
poverty if sufficient employment opportunities are not created. Some economists
have insisted that structural adjustments will automatically create employment
in the services and technology sectors, but Dev contends that this is not enough.
The issues facing employment in India are the expected growth of the workforce,
 Book Reviews „ 317

slow employment growth and the country’s burgeoning unorganised sector. The
combination of the first two has resulted in a mismatch between growth and em-
ployment: service and IT industries are the fastest growing sectors but they are
also unable to generate enough employment, especially for unskilled labour. Also,
rigidities in the labour market (like minimum wages and the inability for workers
trapped in low demand sectors to relocate to sectors where demand is growing) make
it such that shifting labour out of less productive sectors to more productive ones
would take years, and the Indian workforce needs quality employment now. Dev
insists that the solution to India’s employment problem will not be found in labour
market flexibility, but in exploiting intersectoral terms of trade differences through
targeted employment generation programmes. For example, trade liberalisation
shifted terms of trade in favor of Indian agriculture. Thus, one solution to rural

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employment issues is to expand the value chain of agriculture to include food
processing and other allied activities. Not only would services once sought abroad

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become available domestically, but industry would be introduced into rural areas,

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attracting investment in rural infrastructure and reducing urban immigration.
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Some recommendations mentioned in this book seem like common sense. What
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is uncommon is the author’s approach: it’s an approach that makes growth and equ-
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ity friends rather than enemies and unites economics with democratic thought. In
these essays, Dev shows policy makers that they have to make a conscious decision
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to trade lopsided economic development for a more inclusive model that may be
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numerically less impressive, but more sustainable. The book and its author suffer
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from one problem: at times the logic employed is assumed to be self-evident. In

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general, the volume could have been much more accessible if the numbers presented
had been supplemented by a few explanatory sentences. Yet even though navigating
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through tables and appendices can be tiresome, those policy makers, economists,
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NGO workers and development enthusiasts who are patient will see that this book
has potential to change the way economic growth is pursued.
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Reviewed by Rashmi Bhat, Department of Economics, Duke University, USA.

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K.G. Karmakar (ed.). 2008. Microfinance in India. New Delhi: Sage Publications.
489 pp. Rs 695 (HB). ISBN 978-0-7619-3626-8.

The concept of microfinance was first introduced in Bangladesh by Nobel Peace

Prize winner Muhammad Yunus. Microfinance has evolved remarkably since then:
what started as a grassroots movement has now become an important strategy in
the fight against poverty for many developing countries. The growth of the industry
worldwide in terms of number and size of microfinance institutions, number of
clients and provision of donor funding has been tremendous in recent years. While

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318 „ Journal of South Asian Development 4:2 (2009): 283–320

a lot has been written about microfinance in Bangladesh and Indonesia, the Indian
microfinance experience has not yet received as much attention. This, however, is
now changing as India’s microfinance sector is rapidly growing. Microfinance in
India started to seriously take off with the launch of the self-help group (SHG)–
bank linkage programme in 1992 by the National Bank for Agriculture and Rural
Development (NABARD). The aim of the NABARD-initiated programme was
to provide the rural poor with access to formal credit in a cost-effective and sus-
tainable manner. It is argued that the SHG–bank linkage programme was possibly
the largest microfinance intervention in the world in terms of outreach. Since
1992, the programme has expanded rapidly and new players and approaches to
delivering credit to the poor have emerged. However, NABARD’s SHG–bank linkage
programme is still the dominant credit delivery model in India.

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This book is a collection of essays by a range of microfinance experts compiled and
published by NABARD’s Managing Director K.G. Karmakar. Since this publication is

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a NABARD-driven effort, it is not surprising that it focuses on the diversity of current

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credit delivery mechanisms and the importance of linking banks with microfinance
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institutions (MFIs). The book provides the reader with a comprehensive overview of
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the challenges faced by various microfinance delivery models and suggests possible
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innovations in evolving new credit delivery mechanisms.

This publication is split into six parts. The first part provides a general overview
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of the financial system and microfinance in India. Part II builds thereon and
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presents a more in-depth overview of Indian microfinance and introduces the

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current challenges to microfinance in India, with a focus on the regulatory efforts

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that have been made so far. Part III concentrates on the evolution of the SHG–bank
linkage programme, its characteristics, achievements and future challenges. Case
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studies are then presented in part IV and V, with the aim to illustrate successful
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approaches to delivering microfinance devised by MFIs and banks respectively. As

a conclusion, part VI discusses the various microfinance innovations with a view to
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further developing new credit delivery models, for example, the role of technology
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for including the poor into the financial system and new approaches to evolving
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the established SHG concept.

This book seeks to provide an overview of microfinance in India with a focus
on introducing the various microfinance delivery mechanisms. It illustrates the
transformational nature and growing diversity within the sector in recent years.
However, the transformation of India’s microfinance sector does not stop with the
emergence of new credit delivery models. In addition, a high degree of organisational
diversity can be found which makes India’s microfinance industry rather unique.
While this publication succeeds in presenting the reader with valuable information
on current and future challenges of microfinance in an Indian context, it would
have been desirable to see a more detailed account of organisational diversity which
is an important issue with implications for the successful regulation of the sector.
 Book Reviews „ 319

Microfinance in India is typically offered by microfinance-non-governmental organ-

isations (MF-NGOs) which are registered as non-profit organisations and which
come in a variety of legal formats, that is, societies, trusts or section-25 companies.
The Reserve Bank of India (RBI) usually prohibits all non-profit organisations
from taking deposits. Thus, the majority of organisations have to refrain from
mobilising savings because of their organisational set-up. It is argued that this is a
major drawback, because the poor need savings more than credit. A solution to the
savings dilemma is to register a MFI as a mutual benefit organisation, which comes
in the form of cooperatives. Furthermore, many for-profit MFIs have emerged over
recent years, so-called non-banking financial companies (NBFCs). Examples include
organisations like BASIX and SHARE. However, NBFCs, although regulated by
the RBI, are not allowed to take deposits. Only the NBFCs, which are registered as

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residuary non-banking companies (RNBCs), which are a category within NBFCs,
are allowed to raise deposits. Efforts have been made to resolve the issue surrounding

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savings mobilisation.

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In fact, one of the main reasons for drafting the so-called Microfinancial Sector
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(Development and Regulation) Bill was to allow MFIs to mobilise savings. The bill
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was initiated based on demand for a sound regulatory framework. The rapid growth
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of the industry in recent years, the Andhra Pradesh microfinance crisis in 2006 and
alleged abusive practices have all contributed to the push for a regulatory mechanism.
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However, the bill is still being discussed by the government and stakeholders and
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has not yet been passed by parliament.

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Another important topic that has received marginal treatment in this book is
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the trend towards commercialisation. Commercialisation is described as the trans-

formation from being a subsidised, donor dependent operation to becoming a
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regulated financial intermediary. MFIs desire to scale up operations to satisfy their

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capital needs. Though the industry has grown tremendously in terms of outreach
and disbursements, even more resources are needed in order to be able to bridge the
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gap between demand and supply of funds. Typically, commercialisation manifests

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itself in two different ways. First, MF-NGOs transform themselves into NBFCs with
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the advantage of then being able to function as a business which operates under
a regulated legal framework. Second, the entry of commercial banks into micro-
finance is usually accomplished by establishing linkages with MFIs. The ICICI Bank
partnership model, which uses MFIs as intermediaries, is such an example. The
MFIs are still responsible for the origination, managing and collection of loans but
the credit risk is fully borne by ICICI Bank by shifting the loans onto their books.
Generally speaking, commercialisation results in merging formal and informal
sector approaches, which appears to be the way forward for India’s microfinance
industry.
Overall, this publication has made a valuable contribution to the microfinance
literature and comes at a time when India’s microfinance sector is in a state of flux,

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 320 „ Journal of South Asian Development 4:2 (2009): 283–320

presenting an abundance of opportunities for investors, policy makers and micro-

finance professionals alike. The book will be of interest to policy makers, academics
and microfinance professionals. It might also be a good introduction for readers
who are not familiar with microfinance in an Indian context.

Reviewed by Maren Duvendack, School of International Development, University

of East Anglia, UK.

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