Thursday, 3 July 2014

Why India Needs an Alternative Development Policy Frame?

Beyond GDP

Photo Credit: OSHO NEWS
As Indian economic policy experiments have passed through the phases of Nationalisation to liberalisation to inclusion across the timeline of more than sixty years since independence, the citizens of the country have shared the fruits and have bore the brunt in various ways. India has made enormous economic progress with conventional indicator like Gross Domestic Product (GDP), but has failed to improve the quality of life en mass. Such progress has created enclaves of opportunities but neglected the masses. Inequality and its complex proliferation is the foremost challenge in India now, which constantly provokes the idea of an alternative development instrument.

 GDP the most widely followed metric assesses the performance of an economy, simply by measuring the market value of all final goods and services produced within a country in a given period. It takes into account the growth of commercial and economic activities but cannot capture the pertinent issues of assessing overall well-being of a country. Attempts are therefore increasingly being made across the world to look beyond GDP for an alternative measure to assess the well-being of a nation through a multi-dimensional approach like creating access to resources; reducing hunger, poverty and inequality, and imbibing distributive justice. These can change the lives of millions by ensuring opportunities, economic freedom and social harmony.

 Alternative Approaches

Reducing inequalities and subsequent conflicts amongst people is one of the major challenges in the world today. Way back in 1972, the small Asian nation, Bhutan had introduced Gross National Happiness (GNH), an alternative to GDP with four pillars of good governance, sustainable socio-economic development, cultural preservation and environmental conservation. In 1990, another alternative to GDP that is Human Development Index (HDI) was pioneered by two Asian thinkers Mahbu bul Haq and Amartya Sen, which incorporates health and education along with income. In the year 2008, when French president Nicholas Sarzoky looked for next alternative to GDP, a revolutionary report was brought out with emphasis on social progress.The report emphasizes on quality of life and sustainability along with classical GDP. In the following year in 2009 another study made by a group of scholars from World Bank on ‘Measuring Inequality of Opportunity in Latin America and Caribbean’, emphasises Human Opportunity Index to measure inequality in opportunities in basic services. The idea was inspired by the social welfare function proposed by Sen in 1976 and holds that in development process, society needs an equitable supply of basic opportunities and people need access to these opportunities, with a target of universalism. Sen’s powerful idea of Capability Approach in 1980s also has widened the scope of development theory with emphasis on quality of life and removing the obstacles to achieve more freedom to choose.

To evolve development policies with such ideas of progressive economy with centrality on human wellbeing, a country needs fair political democracy, which was realized by the visionaries of newly born India and was reflected in the constitution of India in 1950 emphasising the three core values of justice, freedom and equality for citizens in India. Democracy, which is synonymous with individual sovereignty and equality, has a causal relationship with progressive economic development. It is being empirically tested that democratic institutes have net positive effect on progressive economic development, the later is perceived as a process of transition for a better living taking place along a continuum of ever-changing ideas and ethos in the life of a nation or society.But in many practicing democracy like India, economic elites mostly manage to retain disproportionate influence, and preserve the profit-seeking anti-poor biases and distort the idea of democracy. This denies social justice, tends to deprive many and excludes the voices of the marginalized. This is primarily because the practicing development policiesis mostly a conventional post war western idea and premised on rational individual, capital formation and inequality. Such economic development which necessarily influences political discourse tends to create chaos and denies egalitarian frame, and thus democracy tends to function non-optimally. To attend a causal relationship between economic development and democracy, the existing development model needs a revisit incorporating voice, representation and rights.

Way Forward

With the recent change in political regime in 16thLokSabha election, India is expected to see some major policy shifts towards stronger market-oriented and liberal frame to push GDP growth rates. This may boost the economy, making the rich richer, but also has probability of increasing marginalization of small voiceless communities. The erstwhile govt. has made tremendous attempt to protect many such communities through path-breaking right based policies, as rights are the channels of resistance. To ensure long term sustainable development, such emphasis on policies with an institutional frame is crucial, which alone can bring social change in India. The policy instruments of new political representation needs to continue to evolve within such inclusive frame, which alone can ensure redistribution, enhance social justice and enable economic autonomy and well-being of every section of the society. Political democracy therefore needs to create space through debates and dialogues for alternative development policy initiatives, which can make ways for every individual to live with dignity and freedom, and can encounter divides and disparities in the society.

Rakhee Bhattacharya