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State Level Reforms, Growth, and Development in Indian States

Author

Listed:
  • Panagariya, Arvind

    (Columbia University)

  • Chakraborty, Pinaki

    (National Institute of Public Finance and Policy, New Delhi, and Honorary Research Scholar, Jerome Levy Institute, Bard College, New York)

  • Rao, M. Govinda

    (National Institute of Public Finance and Policy, New Delhi, and Member of the Advisory Council to the Prime Minister of India)

Abstract

Most discussions of India's substantive economic growth since the 1990s tend to focus on national level statistics or on particular sectors such as the financial and call service sectors or on the pharmaceutical industry. But with a population of 1.2 billion, India demands to be treated like a collection of individual "countries, " rather than a unified nation. Ten of its states have populations equaling or exceeding that of the United Kingdom. If the state of Uttar Pradesh were a country, it would be the fourth largest, behind China, India, and the United States. These facts pointedly tell us that if we are to understand the ongoing experiment in economic reforms and poverty alleviation, we must study India at the level of the state. In this spirit, State Level Reforms and Growth and Development in Indian States provides the first-ever comprehensive analysis of growth at the highly diverse state level. The authors argue that when the national government loosened its stronghold on industry and services, state governments were able to shape the fortunes of their citizens through state-level policy reforms. Because of this, every Indian state experienced accelerated growth, unlike China during the first two decades of its development when the eastern half flourished as the western half lagged. Every Indian state has grown faster in the last decade than any other decade in the post-independence era. In fact, some of the poorest states, notably Bihar and Orissa, have been growing the fastest. Professors Panagariya and Chakraborty and Dr. Rao refute the common assumptions that growth has not occurred or that poverty has not been reduced in all Indian states. The recent reforms have also led to improved access in every state to basic amenities such as permanent houses, electricity, water, and sanitation. These accomplishments notwithstanding, regional inequality on a per capita basis has grown as well. Reforms in state-controlled sectors such as agriculture, industry, healthcare, and education have not advanced as far as some analysts previously predicted. The authors outline the reforms in these areas and draw on the experience of states that have successfully carried out some of them. The authors pay special attention to reforms in the areas of education and health while recognizing that the Indian constitution vests in the states much of this legislative and other authority and while considering the real absolute rise in income, literacy, and health status across all the states. Available in OSO: http://www.oxfordscholarship.com/oso/public/content/economicsfinance/9780199367863/toc.html

Suggested Citation

  • Panagariya, Arvind & Chakraborty, Pinaki & Rao, M. Govinda, 2014. "State Level Reforms, Growth, and Development in Indian States," OUP Catalogue, Oxford University Press, number 9780199367863.
  • Handle: RePEc:oxp:obooks:9780199367863
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    Citations

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    Cited by:

    1. Sthanu R Nair, 2021. "Agrarian suicides in India: Myth and reality," Development Policy Review, Overseas Development Institute, vol. 39(1), pages 3-21, January.
    2. Bathla, S. & Kumar, A., 2018. "Income Inequalities among Agricultural Households in India: Assessment and Contributing Factors," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277329, International Association of Agricultural Economists.
    3. Tiwari, Aviral Kumar & Eapen, Leena Mary & Nair, Sthanu R, 2021. "Electricity consumption and economic growth at the state and sectoral level in India: Evidence using heterogeneous panel data methods," Energy Economics, Elsevier, vol. 94(C).
    4. Dhongde, Shatakshee, 2017. "Measuring Segregation of the Poor: Evidence from India," World Development, Elsevier, vol. 89(C), pages 111-123.
    5. Seema Bathla & Pramod K. Joshi & Anjani Kumar, 2019. "Targeting Agricultural Investments and Input Subsidies in Low-Income Lagging Regions of India," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 31(5), pages 1197-1226, December.
    6. M. Govinda Rao, 2018. "Public finance in India: some reflections," DECISION: Official Journal of the Indian Institute of Management Calcutta, Springer;Indian Institute of Management Calcutta, vol. 45(2), pages 113-127, June.
    7. Rashmi Shukla, 2023. "Multidimensional Poverty and per Capita Income in Uttar Pradesh: A District-Level Analysis," Indian Journal of Human Development, , vol. 17(2), pages 310-319, August.
    8. Rashmi Shukla, 2021. "Government Expenditure on Drinking Water and Sanitation in Uttar Pradesh, India: An Empirical Analysis of Its Trend and Composition," Indian Journal of Human Development, , vol. 15(3), pages 515-531, December.
    9. Amar Kumar Mohanty & Narayan Chandra Nayak & Bani Chatterjee, 2016. "Does Infrastructure Affect Human Development? Evidences from Odisha, India," Journal of Infrastructure Development, India Development Foundation, vol. 8(1), pages 1-26, June.
    10. Fernanda Andrade de Xavier & Aparna P. Lolayekar & Pranab Mukhopadhyay, 2021. "Decentralization and Its Impact on Growth in India," Journal of South Asian Development, , vol. 16(1), pages 130-151, April.
    11. Bathla, S. & Kumar, A. & Joshi, P.K., 2018. "Regional income inequalities and public investments in rural India," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 31(1).
    12. K L Krishna & Deb Kusum Das & Abdul A Erumban & Suresh Aggarwal & Pilu Chandra Das, 2016. "Productivity Dynamics In India’S Service Sector: An Industry-Level Perspective," Working papers 261, Centre for Development Economics, Delhi School of Economics.
    13. Rao, M. Govinda, 2017. "Public Finance in India in the Context of India's Development," Working Papers 17/219, National Institute of Public Finance and Policy.
    14. Niti Aayog GOI, 2016. "Raising Agricultural Productivity and Making Farming Remunerative for Farmers," Working Papers id:8429, eSocialSciences.
    15. Bishwanath Goldar & K. L. Krishna & Suresh Chand Aggarwal & Deb Kusum Das & Abdul Azeez Erumban & Pilu Chandra Das, 2017. "Productivity growth in India since the 1980s: the KLEMS approach," Indian Economic Review, Springer, vol. 52(1), pages 37-71, December.

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