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| Shri Pranab Mukherjee, president of India (left) greeting Mohammad Karim Khalili, vice president of Afghanistan, New Delhi, Aug 21, 2013 |
India's rupee crisis has muted its obsession with
overtaking China and with growth halving in recent years, international focus
has been drawn to the development challenges in Asia's third biggest economy.
Amartya Sen, a Nobel laureate,
is a professor of economics and philosophy at Harvard, and this week he
wrote in The New York Times that since Indian independence in 1947, life
expectancy at birth has more than doubled, to 66 years from 32, and per-capita
income (adjusted for inflation) has grown fivefold. In recent decades, reforms
pushed up the country’s once sluggish growth rate to around 8% per year, before
it fell back over the last two years.
He however acknowledged China's superior capacity
to deliver public services and said that almost one in every 5 males and one
in every 3 females are illiterate while less than half the children can
divide 20 by 5, even after four years of schooling.
China's public spending on health is at 2.7% of
GDP (gross domestic product) while India's is at 1.2%.
Sen says the inadequacies in education and health
require more democracy not less, rather than moving closer to China's
authoritarian system.
Jagdish Bhagwati, the other well-known
Indian emigrant economist who is professor of law and
economics at Columbia University, is a bitter rival of Sen's and they are each
79 years old.
Bhagwati, is best known for his work on trade and
has been critical of Amartya Sen's model of growth, which he says has actually
hurt the poor in India by not really supporting the market reforms in 1991 and
pushing for a Food Security Bill which would create inflation.
India has a notorious reputation for bureaucratic
red tape and Prof Bhagwati has no confidence in the political system delivering
a significant improvement in public services.
Last month, 23 children, aged between four and
12, died after eating a lunch of lentils, potatoes and rice cooked at the school
in a poverty-stricken village.
Forensic tests showed the meal was contaminated
with monocrotophos, a lethal pesticide banned in many countries.
The infrastructure deficit was highlighted last
year when there were huge electricity blackouts, affecting 600m people.
Arvind Subramanian, an Indian national,
who is based at the Peterson Institute for International Economics in Washington
DC, wrote:
[In Lord Richard Attenborough’s movie Gandhi,
an underling of the British Empire heatedly warns his supercilious boss that
Mahatma Gandhi’s impending protest march to the sea poses a far greater threat
than the Raj realizes: “Salt, sir, is a symbol.” This elicits the memorable
sneering put-down from the boss (played by Sir John Gielgud): “Don’t patronize
me, Charles.”]
Subramanian asked: is power, or rather the power sector, today’s salt - -
emblematic of both the pessimistic outlook and promise of India?
Twenty years ago, just over 40% of India’s
households had electricity. Today, that’s up to 66%. Much of the power is stolen
or given away free. Local politicians put pressure on power companies to keep
tariffs low, which leads to huge losses.
Advances in solar technology such as
the solar lamp, have great potential in rural areas.
Soutik Biswas, Delhi correspondent of
the BBC,
said in August 2012:
- India has an installed capacity of more than
170,000 megawatts, up from a mere 1,362 megawatts at the time of
Independence in 1947;
- Despite its soaring energy needs, India has
one of the lowest per capita rates of consumption of power in the world -
734 units as compared to a world average of 2,429 units. This is nothing
compared with say, Canada, (18,347 units) and the US (13,647 units). China's
per capita consumption (2,456 units) is more than three times that of
India.;
- Sixty-five years after independence, only
nine states - - Andhra Pradesh, Gujarat, Karnataka, Goa, Delhi, Haryana,
Kerala, Punjab and Tamil Nadu - - of 28 have been officially declared
totally electrified.
India's exports during 2012-13 stood at
US$300.3bn, while imports were at $491.9bn. The trade deficit stood at $191.6bn.
Ireland's goods exports were insignificant at €235m in 2012 compared with
€337m in exports to Romania. Imports were valued at €365m. Services trade
with India does not even merit separate country data.
Reuters reports that India's foreign exchange
reserves were at $278.602bn as of August 9; China's reserves grew from $600bn 10
years ago to $3.5tn as of June this year.
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