Is Double Engine Growth A Reality?

Prime Minister Narendra Modi and UP Chief Minister Yogi Adityanath | Photo courtesy: Social media

The states that have recently gone into elections have seen BJP actively campaign for “double engine growth”, the idea of having the same political party at the centre, and the states enabling faster growth and development in the state. Gujarat CM Bhupendra Patel has claimed that the state experienced double engine growth under Narendra Modi. Even if, for argument’s sake, the threat it poses to democracy and federalism is ignored, has “double engine growth” really worked out well for the states ruled by BJP?

The Nobel laureate economist Prof. Amartya Sen discussed the dual role of human beings – as beneficiaries, agents and adjudicators of progress and as the primary means of all production. The idea of progress for most parts of India seems to be focused on the latter. While the focus on growth in monetary terms, as indicated by Gross State Domestic Product, dominates, how well this growth has translated into the people who are primarily the agents and beneficiaries of growth ought to be a matter of concern.

Human Development Index

The discipline of Economics has much debated around the idea of growth, poverty, and development, leading to the creation of indices to analyse the reflections of monetary growth in the lives of the people. Human Development Index (HDI) is one such index that considers the level of education, health, and standard of living of the people. The recently released Human Development Report by UNDP has placed India 132nd among 191 countries. India’s score dropped from 0.645 in 2020 to 0.633 in 2021, the pandemic allegedly being the cause.

Ever since the estimation of HDI in 1990, India has been performing considerably well year on year, reaching its best in 2018. However, though the absolute HDI value was increasing, the growth rate has been falling since 2016, indicating a negative trend in change to the HDI. 2020 and 2021 saw negative growth in HDI by 0.003 and 0.009 points, respectively. The pandemic could be the reason for the negative growth in 2020 and 2021, which is also claimed to be universal. However, the fall in India’s ranking in HDI indicates that the relative performance of the country has been poor. It is evident that the pandemic isn’t to be blamed for the fall in HDI, though not negative, which began in 2016.

A graphical representation of change in HDI values of India from 1990 to 2021| Data source: UNDP

A graphical representation of change in HDI values of India from 1991 to 2021| Data source: UNDP

Performance of States

It is widely believed that higher growth in monetary terms transforms into better development. However, a closer look at the Gross State Domestic Product and Human Development Index of the rich states in the country contradicts this belief. 

Gross State Domestic Product for selected states from 2011 to 2019 at base year prices (2011-12) | Data source: MoSPI

HDI of selected states from 2009 to 2019 | Data source: Global Data Lab

Maharashtra, which has the highest income in terms of GSDP is ranked 15th and falls in the Medium Human Development group with a score of 0.697 as per 2019 data. Kerala, which is the 11th in GSDP, tops all components of HDI and is ranked first with a score of 0.782. While Tamil Nadu, the second richest state, is in the high HDI group, Uttar Pradesh, the third in terms of GSDP, is the second worst performer in terms of human development. Bihar, the consistently poor performer in terms of HDI, has the 14th highest GSDP in the country.

Furthermore, the Multidimensional Poverty Index, which captures deprivation in health, education, and living standards, recently released by NITI Aayog, shows the glaring differences in the multidimensional poverty levels of the states. While the poor in Kerala constitute 0.71%, the same is estimated at 14.85% in Maharashtra. More than half the population in Bihar, 51.91%, are deprived of basic development components. The deprived population in Tamil Nadu is 4.89%, while that of Uttar Pradesh is 37.79%. Certainly, monetary growth isn’t transforming into decent standards of living for the people who are the producers of the growth.

Multidimensional Poverty Index of Selected States for 2021 | Data source: NITI Aayog

“Double-Engined” Gujarat Model

Ever since BJP came to power in 2014, the leaders of the party have been trying to capture power in various states, proclaiming the benefits to the states if both the centre and the states are ruled by the same party. This is not only hinting at the probable discrimination against non-BJP ruled states but is also challenging the basic tenets of democracy and federalism. Several leaders of non-BJP-ruled states have flagged the worsening centre-state relationship and threat to federalism.

Gujarat is the model state that BJP claims to be the alternative for economic growth. While the state has seen a positive trend in GSDP growth, data shows that the lives of the people of the state haven’t improved accordingly. One of the most industrialised states in the country, Gujarat is the fourth largest economy with considerable primary and secondary sector production, with industries ranging from textiles and pharmaceuticals to oil refineries and automobiles.

In terms of human development, however, Gujarat has not much to be proud of. With an HDI of 0.672, Gujarat is a state with medium human development. In terms of multidimensional poverty, it ranks 16th. This is in a state that has scores of billionaires, including the richest man in the country, who briefly became the wealthiest man in the world a couple of times in the recent past. 

The proponents of double engine growth seem to forget that Gujarat has been ruled by BJP since 1995 (barring a short period of less than two years), during which Narendra Modi was the CM of Gujarat for about 13 years. His ascend into Prime Ministership in 2014 has seen BJP ruling the state and the centre for eight years. 

A comparison of Gujarat with the south Indian state of Tamil Nadu gives a better picture. Gujarat and Tamil Nadu had a difference of 0.001 in their HDI scores in 1990. In 2019, Tamil Nadu had a score of 0.709, while Gujarat’s score was 0.672, a difference of 0.037. While Tamil Nadu experienced steeper growth in HDI, Gujarat has been growing at a slower pace.

HDI of Gujarat and Tamil Nadu from 1990 to 2019 | Data source: Global Data Lab

Tamil Nadu took off in the mid-90s, maintaining a positive rate of growth for most parts of the three decades. The difference between their HDI began widening in the mid-90s. While Tamil Nadu is in the high HDI group now, Gujarat is in the medium HDI group. In about three decades, Tamil Nadu has seen considerable growth in education and health indices.

Values of HDI components of Gujarat and Tamil Nadu for 2019 | Data source: Global Data Lab

The general notion of industrialisation and urbanisation being the solution to economic problems is evidently becoming a myth with the analysis of development in Indian states. Rapid industrialisation would add to the aggregate output and income of the state. But the impact it has on the lives of the people isn’t significant enough to provide them basic dignity of life. The impact of growth has often been limited to the rich, excluding the majority, who were directly the producers of this growth. 

Terming India’s experience of neoliberal and neoclassical growth models as “predatory growth”, economist Amit Bhaduri talks about jobless growth and the augmentation of profits for the rich and misery for the poor. While growth resulted from increased labour productivity, it came at the cost of higher working hours and non-existent social security for the labourers. The increase in output was often dominated by products outside the consumption basket of the majority who are struggling to make ends meet. The impact of neoliberal economic policies on the growth and development of India is a topic that requires much attention and has scope beyond the limitations of this article. However, it can be inferred that increased economic growth does not automatically improve the lives of the people but, in fact, comes at a much higher price paid by the common people.

Development: A Broader Understanding

Prof. Amartya Sen’s concept of development, based on which the Pakistani economist Mahbub ul Haq created the HDI, gives a broader understanding of the idea of development. Unlike his predecessors and contemporaries for whom development was very much aligned with growth, Prof. Sen looked at the question of development from the perspective of an individual’s freedom. Only with freedom and the capabilities associated will an individual be able to “develop”, leading to overall social developments. The question of development thus has a two-way understanding – from individual to society and vice versa.

Prof. Sen believed that economic progress is only a means to enrich the lives of the people. Treating it as the end is the reason for the conundrum of high income and low human development in various economies. He believed that development was to enhance the capability of individuals. Capability, according to him, was the freedom of a person to choose between different ways of living. With better education, health, and living standards, one is supposed to have better freedom to choose a way of living that would suit oneself. While the argument isn’t flawless, it gives a broader understanding of the idea of development and the necessity to focus on people as agents and ends rather than as means to increase economic output.

A slum in Mumbai, India | Photo courtesy: Pixabay

India has a complex social system. Deprivation in India isn’t based on class alone but is intertwined with caste and multitudes of social hierarchies, including gender, religion, geographic spaces, and so on. Unless growth in monetary terms would lift people out of socio-economic deprivations, it is meaningless. Evidently, India’s example explains this. The root cause of poverty and allied deprivation in India is not the lack of resources or wealth but equitable distribution, access, and opportunities. 

The growth that we take pride in is the growth of wealth of the super-rich in the country, who are further determined by their social positions in terms of caste, gender, and religion. The pandemic saw millions of Indians getting pushed into poverty while the richest Indians multiplied their wealth several folds. This inequality is not economic alone but is very much social as well. The real development in India can happen only if we understand our country’s peculiar but evident features and devise policies that work in our socio-economic and political system. This is where southern states have set an example.

The Southern Alternative

A quick analysis of HDI indicators across the states shows that southern states have performed much better than the north. Kerala maintains its top position across all components of human development. The Kerala model of development, which refers to high human development with relatively low GSDP, has been discussed by development economists worldwide. Tamil Nadu has a slightly different story. The state has been performing well in terms of monetary growth and reasonably well in human development indicators. The common factor that has resulted in this development trend is the progressive reformist values that the states hold.

The achievements that Kerala takes pride in today result from several bloodied and long struggles that the people of the marginalised communities took up. A severely caste-ridden society, Kerala has even seen agitations by lower caste women to cover their upper bodies. This movement, Channar Lahala, which took place in Travancore in 1817, is regarded as one of the first mass movements of women in the Indian subcontinent. Kerala is a model for the rest of India not only for its advancements in development indices but also for its people-centric social and economic reforms.

The experience of Dr Palpu is a fitting example for the growth vs development argument that continues a century later. Dr Palpu, who was an Ezhava from a well-to-do family – an odd feat at the time – got trained in modern medicine from Madras after he was denied admission to the medical colleges in Travancore even though he secured the second rank in the Travancore Government Medical Exam. He was also denied the opportunity to work as a doctor in Travancore and was instead asked by the Raja to practice the job traditionally assigned to the men of his caste. He left Travancore for Mysore and later became the most celebrated doctor who worked tirelessly during the plague of 1896 in Bangalore.

Dr Palpu was able and had the means to train himself in modern medicine. However, his capability to function as a doctor in Travancore was limited by the social system he belonged to. His riches did not transform into the development of agency and freedom to perform, ideas that Prof. Amartya Sen uses in the development discourse. Growth in monetary terms will not result in development if social and political factors aren’t transformed for the better. Kerala successfully undertook this transformation, thanks to the social reform movements in the state in the late 19th and early 20th centuries.

Look at the case of literacy, for instance. Caste disaggregated data on literacy from 1875 to 1931 show that education was primarily accessible to the higher castes of the state. Female literacy, which was 4.13% in 1901, rose to 92.98% in 2011. By 2016, Kerala became the first state in India to attain 100% primary education. Social reform movements in Kerala were all about equal opportunity and dignity for the lower caste, lower class, and women.

Starting in 1891, several petitions and agitations for access to education and jobs for the lower caste shaped the narrative of a better life with better education among the marginalised in the state. The massive movements led by Ayyankali for admitting Pulaya (Dalit) children into government schools also paved the way for the first agrarian movement in the state. The movement, which is often tagged as a caste movement, has multiple dimensions of access to education, gender, and class unity converging for a better, developed life. 

Similarly, Sree Narayana Guru, who vehemently fought against the caste system, also spoke about the need to build more schools than temples. He believed that the only way to reform the downtrodden was by providing them with education. Education became a collective necessity with the social movements and was accessed through popular agitations. The role that missionary schools played in providing this access is also noteworthy. A society that transformed itself through education continued the trend with the policies of the governments that ruled it. 

EMS Namboodiripad, the first Chief Minister of Kerala in 1957-59 | Photo courtesy: Special arrangement

The first democratically elected government of Kerala under the leadership of E. M. S. Namboodiripad had its priorities set in a people-centric growth with land reforms and the development of people. One of the first major orders that the government enacted was the ban on all evictions of tenants. Subsequent measures were taken to bring about a comprehensive agrarian bill that included land redistribution, land ownership for tenants, and minimum wages for agricultural labourers.

Another major policy decision that the first democratic government of Kerala took was regarding education. The education bill aimed at achieving universal and compulsory education within ten years. It also included the provision of free food and uniforms for students. While the government faced brutal opposition from the socially forward communities of the State, especially from the Catholic Church and the Nair Service Society, the basic principles that guided governance in the state, particularly those taken up by the Left governments, remained intact. 

In 1987, then Chief Minister E K Nayanar successfully launched a mass movement for the Total Literacy Program, which paved the way for the creation of the National Literacy Mission at the national level. In 1996, under the leadership of E K Nayanar, saw the launch of a revolutionary programme – the People’s Plan Campaign. Under the People’s Plan, decentralisation was focused, and micro units of governance at village levels were given more power and autonomy. People at the grass-root level were taken into confidence, and development plans were made for them based on their needs. Rather than the usual top-down approach, a bottom-up approach was adopted. This move strengthened the agency and authority of people, made governance more accountable and transparent, and created a people who are aware and assertive of their rights and deprivations.

Karthyayini Amma - NariShakti Puraskar 2019 Awardee in Individual category - appeared for the fourth standard equivalency course under Kerala Literacy Mission’s Akshara Laksham Scheme in August 2018 | Photo courtesy: @MinistryWCD

The reason that the population is deprived of basic standards of living, including education, health, housing, and sanitation, as indicated by the Multidimensional Poverty Index, being less than 1%, is the result of this people-centric development model that the successive governments adopted over almost seven decades. The very fact that one of the least industrialised states in the country having the highest level of human development and the lowest level of poverty questions the validity of the argument for industrialisation and money/output-centric growth models.

Tamil Nadu is another example of progressive social transformation resulting in the development of the people. Several social reformers, like Subramanya Bharathiyar, stood up against casteism and fought for the rights of women and the marginalised. The Justice Party and the Self Respect Movement led by Periyar E V Ramasamy was a milestone in Tamil Nadu’s progressive movement and its fight against the caste system. Being a staunch feminist, he also fought for women’s rights, access to education and property, and a better position for women in society. The state has tried to uphold the values of the anti-caste movement by Periyar, trying to build a just and equitable society. The creation of such a society through socio-economic policies has seen commendable results in Tamil Nadu.

Upholding the vision of Periyar, the Dravidian Model, as claimed by the ruling DMK, has its roots in a growth trajectory based on social justice, rational thinking, and creating an equal and just society. The steadfast hold on their language, identity, and autonomy created a sense of collective belonging among the people of the state. This led to greater political mobilisation among the people. The state focused on the sustainable growth of industries, inclusive of backward classes. Special provisions for women were made in educational institutions and public offices. Accessibility in the form of public transportation was made women-friendly, leading to better participation of women in education and the paid labour market.

The Mid-Day Meal Scheme is an example of the progressive vision of Tamil Nadu. It was launched by K. Kamaraj, the then Chief Minister of Tamil Nadu, in the early 1960s. The programme of providing nutritious meals to school children has resulted not only in fighting malnourishment but also improved school enrolment of children. In a state that was battling poverty and child labour, this scheme played a humungous role in ensuring better educational opportunities and capability enhancement, especially among the marginalised communities, for generations to come.

People-Centric to Community-Oriented Growth

Development policies that are people-centric in nature have dual impacts. While it transforms the lives of individuals, it also creates a collective consciousness of capability, freedom, and development at large. The values of equality and justice triumph over the traditional belief system of the society that is deep-rooted in casteism and gender inequality. The people in a society that values education and health, and are aware of their social position and deprivation, will be better conscious politically and socially. They will be better mobilised and organised. They will value the dignity of life over insignificant numbers projected as growth.

A society thus enhanced with the ideals of better living takes it as the collective responsibility to ensure the same for every individual. The community adds pressure to ensure that no child is deprived of education or health. The government becomes accountable to the general public for incidents of specific deprivations, be it a case of malnourishment among pregnant women and children or a village denied access to quality education due to geographical barriers. Such a society will have powerful media and civil societies that ensure that no person is left behind in the development process. Inclusivity will be demanded by the people, and governing gets people-centric and transparent. This is in praxis in the southern states with higher HDI.

Every person’s life begins to improve when policymakers focus on the betterment of people rather than the growth of macroeconomic variables. Indian experience has largely shown that growth in GSDP has not proportionately reflected in the lives of the people who are the agents of growth. 

The claims of the ruling BJP about double engine growth are disputed by the data available on growth and development. It is to be noted that the south Indian states mentioned here have never been ruled by BJP so far. Nor have they been ruled by the same party at the centre and the state level for a considerable period of time. In fact, the number of seats the BJP has in the state assemblies have been significantly low, countering the claim of growth put forth by the party.

Economic growth, which does not reflect in the lives of the people, is irrelevant because, ultimately, it is the people that matter. Policies ought to be for the betterment of the lives of the deprived, not the privileged. Only then shall freedom and development find their meaning in their truest sense.