Economic development in Orissa: Growth without inclusion?

The economy of Orissa has been lagging behind the national economy by several decades. Its per capita net state domestic product, a measure of average income, stood at Rs.20200 for 2006-07 which falls behind the national average by about 35 per cent. Moreover, the gross domestic product of the state grew by a considerable lower rate than many other states for a long time despite its high growth potential. Drawing on the experience of several countries as well as that of India, various studies concluded that economic growth was the most critical factor for reduction of incidence of poverty in the state. It now seems that there has been a turning point in the last few years and the economy of Orissa has witnessed an acceleration in terms of the gross state domestic product (GSDP). The evidence presented here clearly shows that the economy is poised for a take-off to a high growth phase, almost similar to that at the national level. On the poverty dimension, however, the recent developments have been gloomy, to say the least. The consumption expenditure surveys carried out by the National Sample Survey Organisation (NSSO), the standard source of data for poverty analysis in India by official and non-official investigators, shows that the period 1993-2004 has witnessed a reversal of the achievements made on the poverty front during 1983-93. The prima facie evidence points towards a case of growth without inclusion and needs further probe.Gross State Domestic Product (GSDP), India, Poverty

Growth and Poverty in Maharashtra

Maharashtra is among the richest states in India in terms of per capita income, yet incidence of poverty in the state remains close to the national average. The states economy grew at a faster rate than the all-India average during 1980-1 to 1992-3, but it slowed down a bit during 1993-4 to 2003-4 due to poorer performance of agriculture and industry. Agricultures contribution to GSDP has come down to 12 per cent in 2002-3, but more than 50 per cent of total workers are still engaged in this. Cropping pattern has been shifting to greater value addition non-cereal crops like fruits, vegetables, oilseeds and sugarcane. Composition of manufacturing has shifted towards more capital-intensive sectors. Communication, transport and public administration have accounted for large part of service growth. The benefits of this growth process have, however, not spread equally across social groups or regions, which partly explains prevalence of high poverty compared to other states at similar mean income. The much talked about Maharashtra Employment Guarantee Scheme (MEGS) has had limited success and its coverage across districts/divisions is not proportionate to the share of poor. Despite these developments, rural poverty has reduced from 38 per cent in 1993-4 to around 24 per cent in 1999-2000. Given current investment flows, the overall growth potential of Maharashtra does look bright for the medium run. But, distributional implications of the emerging growth pattern across sectors suggest that the poor might not benefit proportionately from the growth process. The lessons that Maharashtra provides is that growth has to be more broad-based and inclusive, and that intervention through social welfare programmes like MEGS should be designed to suit the local resource base of poorer regions for faster poverty reduction.Growth, poverty, Maharashtra

Trade liberalization, poverty, and food security in India:

food security, Nutrition, Computable general equilibrium (CGE), Globalization, Markets, trade,

Trade Liberalization, Poverty and Food Security in India

This paper attempts to assess the impact of trade liberalization on growth, poverty, and food security in India with the help of a national level computable general equilibrium (CGE) model. It shows that GDP growth and income poverty reduction that might occur following trade liberalization need not necessarily result in an improvement in the food security / nutritional status of the poor. Evidence from simulations of (partial) trade reforms reflecting a possible Doha-like scenario show that the bottom 30% of the population in both rural and urban areas suffer a decline in calorie and protein intake, in contrast to the rest of the population, even as all households increase their intake of fats. Thus, the outcome on food security / status with regard to individual nutrients depends crucially on the movements in the relative prices of different commodities along with the change in income levels. These results show that trade policy analysis should consider indicators of food security in addition to overall growth and poverty traditionally considered in such studies.Doha negotiations, India trade policy, poverty, food security, CGE model

Gadamer, McDowell, and the Phenomenology of Understanding

My aim in this paper is to critically evaluate the debate between John McDowell and Michael Friedman on the nature of understanding and relativism. McDowell in his magnum opus Mind and World, has argued in favour of the view that the way we are open to reality is constituted by concepts. According to him, our openness to reality is placed in the space of reasons which is nothing but space of concepts. Friedman in his critical and detail review of McDowell’s book has taken McDowell’s project in his book in particular and in his philosophy in general as the project of not constructing philosophical theories but of exorcising the philosophical traditions. It is indeed so as McDowell himself has acknowledged because he closely follows Wittgensteinian quietism in his approach to various philosophical problems. While explaining how our knowledge and perception of the world among other things are placed in the space of reasons, towards the end of his book, McDowell relates space of reasons to language and tradition. Space of reasons, in his opinion, can be understood, in terms of initiating ourselves into language and inheriting the tradition. He thus says, “…the sort of language into which human beings are first initiated, serves as a repository of tradition, a store of historically accumulated wisdom about what is reason for what.” And this is Gadamer in significant sense

Reforms in Indian Agro-processing and Agriculture Sectors in the Context of Unilateral and Multilateral Trade Agreements

In this paper, we explore the potential impacts of trade and investment-related policy reforms on Indias agro-processing sector. We consider the direct effects of policy reforms within the processing sector, and the indirect effects on agro-processing of policy reforms in the primary agriculture sector, in the Indian economy as a whole, and in a multilateral framework. Towards this, we develop a 22-sector, 16-region version of the GTAP computable general equilibrium (CGE), global model for our analysis. We find that trade and investment-related reforms in agro-processing together can help the sector to grow. Policy reforms that stimulate investment and help to improve productivity will be crucial in offsetting the contractionary pressures of trade reform alone on the production of processed agricultural products. We also find that indirect effects on agro-processing from Indias policy reforms in other sectors are more important than reforms in agro-processing itself. Our findings argue for an economy-wide perspective when targeting reform or development of the agro-processing sector in India. Compared to trade reform, comprehensive domestic reforms in the agro-processing and agriculture sectors relating to investment are critical for achieving growth in agro-processing. However, while the impacts of trade reform per se seem to be small, trade reform - by ushering in a higher degree of competition - could itself be a stimulus for investment and productivity gains in India. At present, unilateral reforms, especially those that improve productivity in agro-processing and in primary agriculture, are more important to agro-processing than multilateral trade reforms. Nevertheless, our findings also suggest the importance of pursuing a domestic reform agenda within a multilateral trading strategy that can accommodate the expected economic growth of India and its future role in global markets, with general equilibrium effects on agro-processingagriculture, Agro-processing, Trade agreements, CGE models

CO2 Emissions reduction strategies and economic development of India

This paper examines the consequences of alternative CO2 emission reduction strategies on economic development and, in particular, the implications for the poor by empirically implementing an economy-wide model for India over a 35-year time horizon. A multi-sectoral, inter-temporal model in the activity analysis framework is used for this purpose. The model with specific technological alternatives, endogenous income distribution, truly dynamic behaviour and covering the whole economy is an integrated top-down bottom-up model. The results show that CO2 emission reduction imposes costs in terms of lower GDP and higher poverty. Cumulative emission reduction targets are, however, preferable to annual reduction targets and that a dynamically optimum strategy can help reduce the burden of emission reductions. The scenarios involving compensation for the loss in welfare are not very encouraging as they require large capital inflows. Contrasted with these, scenarios involving tradable emission quota give India an incentive to be carbon efficient. It becomes a net seller for the first 25 years and because of reduction in carbon intensity it would demand less in later years when it becomes a net buyer. The results suggest that for India, and other developing countries, the window of opportunity to sell carbon quotas is the next two decades or so.

Reforms in Indian agro-processing and agriculture sectors in the context of unilateral and multilateral trade agreements

In this paper, we explore the potential impacts of trade and investment-related policy reforms on India's agro-processing sector. We consider the direct effects of policy reforms within the processing sector, and the indirect effects on agro-processing of policy reforms in the primary agriculture sector, in the Indian economy as a whole, and in a multilateral framework. Towards this, we develop a 22-sector, 16-region version of the GTAP computable general equilibrium (CGE), global model for our analysis. We find that trade and investment-related reforms in agro-processing together can help the sector to grow. Policy reforms that stimulate investment and help to improve productivity will be crucial in offsetting the contractionary pressures of trade reform alone on the production of processed agricultural products. We also find that indirect effects on agroprocessing from India's policy reforms in other sectors are more important than reforms in agro-processing itself. Our findings argue for an economy-wide perspective when targeting reform or development of the agro-processing sector in India. Compared to trade reform, comprehensive domestic reforms in the agro-processing and agriculture sectors relating to investment are critical for achieving growth in agro-processing. However, while the impacts of trade reform per se seem to be small, trade reform - by ushering in a higher degree of competition - could itself be a stimulus for investment and productivity gains in India. At present, unilateral reforms, especially those that improve productivity in agroprocessing and in primary agriculture, are more important to agro-processing than multilateral trade reforms. Nevertheless, our findings also suggest the importance of pursuing a domestic reform agenda within a multilateral trading strategy that can accommodate the expected economic growth of India and its future role in global markets, with general equilibrium effects on agro-processing.Agriculture, Agro-processing, Trade agreements, CGE models