Inclusive Growth Story

A few days back, I was chatting with my friend, when the term 'Inclusive Growth' cropped up. Championed by the ruling UPA government and it is the central theme for the Eleventh Five Year Plan for 2007-2012. Growth is inclusive when all demographic segments benefit equally from the economic growth of the nation. It aims to reduce material inequality amongst the citizens. The idea is quite alluring and promises votes from the poor, no wonder UPA supports it.

I strongly disagree with the government thinking. I believe, Inclusive Growth is the new age Communism. Glossy on paper and highly impractical, it is populist scheme to secure votes of the poor majority. This approach infact, is detrimental to the economic progress of the country. In attempting to distribute the benefits of growth to each and everyone, the policymakers fail to provide incentives for performance. The bright end up pulling the weight of the laggards rather than fuel a booming economy.

A person might be poor due to two reasons. Either he may not have access to opportunities to grow, or he may not have the will power to avail opportunities within his grasp. More often than not its the second case. Eg, in Dharavi, the slum-dwellers were provided with flats hoping to eliminate the slum. What did the slum-dwellers do? Rent out the flats and continued staying at Dharavi.

The government should stop trying to distribute income equally, rather it should provide equal opportunities to all, from basic amenities to education. Those who are willing to break their back, will fully utilize them and will get appropriate rewards. The country needs to stop doling out money to people just because they are poor. A significant shift in thinking is required. People have to stop depending on government. Quotas, reservations, and free food/money schemes need to be stopped. People should seek to forge their own path, being independent, having free access to all resources. For this paradigm to occur the UPA should stop feeding fish to the poor. It should rather teach them fishing, feeding them for life.

One might argue that the backward caste/tribes have been ostracized for ages and are now stuck in a rut, deprived of all opportunities. Quotas will help them emerge from that rut. Well, how many students who enter IIT through quota are really poor? They more often than not sons or daughters (mostly sons) of rich parents having access to all amenities, just happen to be classed as backward. The people who are truly needy rarely get access to these opportunities.

However, this approach is not bereft of challenges. Its not easy to provide opportunities to everyone, specially in a 1.3 billion population. Time is also a constraint. The government needs to be quick and decisive, generating opportunities for all. Talent and hardwork should determine access to opportunity. Its not easy to generate opportunities for 1.3 billion. Maybe, its time for India to shed some baggage, after all only the talented and fittest survive.