India a developing nation, dreaming to become a global economic power in future but are we on the right track its still a myth which needs few concerns. Taking states and region there is huge inequality, few regions are well developed while some states are impoverished and poor. States like Jharkhand and Chhattisgarh are mineral rich states but still way below in human development index and way bad in comparison to some of the poorest country of the world. While states like Maharashtra and Gujrat are way better in these norms.
This condition, today ways back in 1980s when country started to grow, but its growth remained in very few states. Since then if we see, more than half of India’s GDP is still generated by 5 states – Maharashtra, Uttar Pradesh, Karnataka, Tamil Nadu, and Gujrat which is 47% of total (2018-19). Despite being similar size, the level of development is not same across all these states, especially in context of Per Capita Income and Per Capita GDP. The difference between the richest and the poorest states has been on a steady rise, indicating a steady rise in overall inequality as well. According to report, the difference between top 5 richest state and poorest states has risen by 145% to 322% in 2018-19 on comparing to start of century. Private investments are typically attracted to those areas which are already developed and equipped with basic infrastructure. But also, the poor states have geographically difficulties, and it is one of the major factors behind the leftover. Bihar and Eastern states are examples of it. While some experts have held ‘over-centralized’ economic policies of the government as responsible for this growth inequality. License raj and corruption are other few norms of it. Policy of subsidized the mineral transportation from the resource rich states to location-based production units acts as kick in the teeth for them. This policy harmed economic growth of mineral rich states like Chhattisgarh, Orissa, Madhya Pradesh etc.
Criminalization, rise of extremist ideas like Naxalism, insurgency in northern states and caste wars etc. have also played significant roles in strengthening regional disparity. Other problems like the failure of land reform policies impoverished already poor people and the lands rights were concentrated in a few hands. Other than pan India disparity, we also witness intra-state disparity in Indian states ‘Intra -state disparity’ refers to some regions within a state which are extremely backward as compared to the other parts of the same state.
The uneven growth impacts the overall development of the country up to a considerable level, had all states grown the average growth rate of 5 states, which is 7.2%, in 2014 India would have a Per Capita GDP income around 1900 US dollars, which would be 1.5 times the actual data. This inequality leads to increase in rate of crimes and insurgencies in the states.
But problem is until it is solved, so to improve there must be a dire need to address the growing regional economic disparity through region-specific comprehensive economic policies, if India wants to achieve ‘equitable development’. It is also important to improve skills of poor state population as industries attract to good skilled labor. Government if want to improve then they must invest in both Social and Physical infrastructure. Social infrastructure includes Health, Education and skill development while Physical infrastructure include Roadways, Railways and Electricity. The union government can also nudge the states under competition federalism to perform better and undertake more measures of reforms.