It argues that this requires states to become major partners in reform, unlike in recent decades where the country’s growth story has been shaped primarily by central government initiatives.
Economists Shishir Gupta and Rishita Sachdeva argue in this article: “This is because the next generation of reforms must be concentrated on factors such as land, labor and capital, coupled with human capital such as education and health, where they play a crucial role.”
The paper says that the average per capita growth rate in India is 4.9% between 1994 and 2020, indicating the task at hand is huge.
The paper says that of the nine growth attributes identified, six are in the state sector (crime, fiscal deficit, health care, communication and distribution losses, labor reform and land policy), highlighting their key role in promoting national growth.
Four key reforms driven by alliance governments since the 1990s are eliminating licenses, opening up the economy for the world, eliminating retention and devaluation. These helped the growth of per capita GDP rose from an average of 3.1% between 1981 and 1994 to 4.9% in the next two and a half years. India’s growth rate in India is estimated to be 6.5% in fiscal 25. Economic surveys expect growth to reach 6.3-6.8% in the next fiscal period. There is no unified strategy
The paper argues that, given the heterogeneity between countries, for their per capita income, growth attributes and other aspects, a “strategy of a certain size” will undoubtedly be for them.
The paper focuses on the performance of the state in two key aspects – their growth attributes and the main economic center (KEC).
It said Gujarat, Karnataka, Himaal Pradesh, Uttarakhand and Andhra Pradesh are strong on both axes and efforts are needed to remove all potential barriers to their critical economic centers to make them more competitive globally, similar to Shanghai and Beijing.
It said Maharashtra, Tamil Nadu and Punjab need to step up their focus on further strengthening their KECs, which is slower than the double-digit expansion of Uttarakhand and Gujarat.
Rajasthan, Bihar, Jharkhand and Jamuk & Kashmir can focus on improving their overall growth attributes. The paper suggests that while Haryana and Uttar Pradesh are witnessing the “spillover benefits” of things close to Delhi, they are better off improving their growth attributes.
