Government Must Push Forward Inclusive Growth Agenda

Bibek Debroy, Chairman, Economic Advisory Council to the Prime Minister

"No able bodied working age group person wants to be voluntarily poor. If people are poor, if people can't avail employment opportunities that is because they are deprived of the elements of physical and social infrastructure."

The government needs to further strengthen the physical and social infrastructure, in order to push forward the inclusion agenda and to bring the people in the mainstream of development.

A large portion of our population is deprived because of the lack of physical and social infrastructure, said Bibek Debroy, Chairman, Economic Advisory Council to the Prime Minister. The most important thing that any government can do is pushing the inclusion agenda to deliver physical and social infrastructure.

With a view to allay the apprehension that the government subsidies and welfare programmes lead to apathy towards work among the poor people, Debroy said, “No able bodied working age group person wants to be voluntarily poor. If people are poor, if people can’t avail employment opportunities that is because they are deprived of the elements of physical and social infrastructure.”

“No able bodied working age group person wants to be voluntarily poor. If people are poor, if people can’t avail employment opportunities that is because they are deprived of the elements of physical and social infrastructure.”
Bibek Debroy, Chairman, Economic Advisory Council to the Prime Minister.

On growing controversies over the official statistics, Debroy said there is lack of good data in India due to largely informal nature of the economy. “India is largely an informal economy. Therefore we don’t have good data, whether it is on employment, labour or other things.”

The SKOCH State of Inclusion Report 2019, revealed that there has been big buoyancy in employment generation in informal sectors on the back of good performance of MUDRA, SHGs and infrastructure development, especially road construction.

However, there is hardly any official data on job creation, either in formal or informal sectors. The government has faced a lot of flak due to lack of unemployment data. 
Debroy said a true picture of unemployment or other social development indicators cannot be gauged on the basis of data gathered through surveys. Only a comprehensive decentralised Census can give a true picture on the ground.

According to the latest SKOCH Group report, some of the programmes undertaken by Prime Minister Narendra Modi government had very positive impact. There have been good impact on informal job creation due to MUDRA scheme and support given to Self Help Groups (SHGs).

There has been a steady increase in the number of Self Help Groups (SHGs). The total number of SHGs that stood at 76.97 lakh in 2014-15 increased to 87.44 lakh in 2017-18. However, there is more impressive improvement in their bank linkages. Gross savings of SGHs with bank more than doubled to R19592.12 crore in the financial year 2017-18 from R9897.42 crore recorded in 2013-14. Loans given to SHGs also more than doubled to R47185.88 crore during the year 2017-18 from R24017.36 crore in 2013-14. Non-performing assets (NPA) rate in bank loan to SHGs dropped by 38 bps to 6.12 per cent during the year 2017-18.

Around 10-20 households benefit from an SHG. In 2017-18, nearly 11 crore households got benefited from the SHGs. The incremental increase of 10.47 lakh SHGs have benefited over 1 crore households.

There has also been a remarkable improvement in financial inclusion due to the Pradhan Mantri Jan Dhan Yojana (PMJDY). The scheme has helped ensure that almost every eligible person in the country now have a bank account. Over 34 crore bank accounts have been opened under the scheme. It is playing a pivotal role in implementation of the key social welfare programmes of the government.

(The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of INCLUSION. Comments are welcome at info@skoch.in)

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