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Good governance is not always good economics

The argument that stability is a prerequisite for achieving higher economic growth deserves clinical analysis.

ht view Updated: Feb 14, 2014 23:42 IST
CP Bhambhri

President Pranab Mukherjee, in his address to the nation on the eve of Republic Day, observed that “fractional mandates” had proved “catastrophic” and a situation had arisen when coalition governments at the Centre had become “hostage” to “whimsically” opportunistic aligned partners. Union minister Farooq Abdullah on February 2 said the government’s “policies that should have been implemented three years back” could not be agreed upon because of the “veto” exercised by one partner or the other.

Even at the international level it has been maintained that the ‘authoritarian Chinese political system’ has an immense capacity to push forward a rate of economic growth that the democratic form of politics of India can’t. The argument that stability is a prerequisite for achieving higher economic growth deserves clinical analysis because evidence from developing countries is not conclusive.

Based on the experiences of developing countries in Asia, Africa and Latin America political stability may be considered necessary but not at all sufficient for achieving the goals of social, economic and human resource development. State governments in India have been quite stable and some of them have not only completed five-year terms in office, a few of them have won elections continuously twice or thrice. Tamil Nadu may be ranked very high in delivering pro-poor and welfare services like the mid-day meal scheme. How could Tamil Nadu, Kerala and Andhra Pradesh achieve a consistently high rank in every sector of development? Why have Uttar Pradesh, Bihar, Madhya Pradesh and Rajasthan failed to come out of their inherited structures of backwardness?

On the basis of the data of the National Survey of the Central Statistics Office and the Planning Commission, of the 20 states for which the data are available, Bihar, UP, MP and Rajasthan rank 19th, 18th, 16th and 15th, respectively, on the basis of developmental indicators (2004, 2005). There is no evidence suggesting that the Centre had followed any discriminatory policies towards these states; on the contrary they enjoyed special political leverage.

Mukherjee, just after taking over as the President, warned that the high rates of economic growth could not automatically “trickle down”. Political interventions are required in a determined manner if the needy are to get the benefits of growth. If some states are left behind the blame lies with the political leadership. The politics of communalism and caste leads to the allocation of resources for development in a differential and discriminatory manner. Politicians make choices while allocating resources for economic and social development and these choices are conditioned by their ideological preferences.

It is clear that a particular model of politics can lead to socially inclusive economic growth with social justice and a communal and casteist model of politics leads to social exclusivism practised by those who profess sectarian and communal ideologies.

CP Bhambhri taught politics at Jawaharlal Nehru University

The views expressed by the author are personal