Sir,
India is perhaps the only large economy in the world which is growing at a 6.5 plus per cent, and yet this growth rate is not supported by some fundamental micro and macro-economic indicators. The million-dollar question these days is can India sustain its rapid economic growth. Importantly, in this phase of de-globalization, and disruption post-demonetisation, it will be a miracle if India can achieve a 7 per cent growth. President Trump has already signed an executive order to pull USA out of Trans-Pacific Partnership deal.
Sustaining this 6.5 per cent plus growth, and generating consumer demand will also require transferring funds to the poor and the deprived, so that distribution of income becomes more equal. Richest 1 per cent in India own 58 per cent of country’s wealth. Around 26.1 per cent of its 1.27 billion population lives below poverty line and 63 million people have been driven into poverty due to high cost of healthcare and education. In this age of 3D printer and data algorithm, when manufacturing process is increasingly becoming mechanized, there is a need to incentivize micro, small and medium enterprises (MSME) sector.
There are some talks about giving unconditional cash transfers to the poor. Although at present government budget deficit and inflation are both under control however direct cash transfer is not a good idea. Cash transfer can at most help to create vote bank but not help the masses to sustain their income. A better idea would be to give incentives for skill-development, and change the existing curriculum in colleges and universities, to make the students more employable.
Yours etc…
Nilanjan Banik
on e-mail
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