We do have a plan: Mayaram

India's growth must be inclusive, with reforms that ensure an equitable society

India is facing the impact of the global economic slowdown, but it does have a plan for faster and more equitable growth, Economic Affairs Secretary Arvind Mayaram said today.

“If everyone thinks there is no plan that is not correct. We are working on growth, but there is a very large area of poor people which needs to be taken care of…There is method in our madness,” Mayaram said at a session on ‘Growth Beyond Numbers: How Can India Shining Be a Story for All?’

Mayaram was reacting to remarks by United Nations Assistant Secretary General Ajay Chibber that much of the problems on growth were self-inflicted and adequate efforts from the government were not seen on second generation reforms.

“We don’t have a well-articulated framework for reforms. We need a welfare system but we can do it much more cheaply and in a much more targeted manner…There is so much government interference at so many levels,” Chibber said. He also said we focus a lot on inequality in income, but inequality in education and health is larger.

Mayaram defended the government and its efforts towards more inclusive growth, as other speakers on the panel also lashed out at the government for failing to do enough. They said India is growing at the expense of the poor and it must introduce reforms to its welfare state if it is to become a more equitable society.

“India should be sensitive. We are becoming more and more insensitive…In the name of the poor, the consumption levels of the rich are increasing,” said Harish Hande, Managing Director, SELCO Solar Light. He said MNREGA is a good scheme but there are so many loopholes that it is misused.

Mayaram said India’s economy for a very long time has been subsidised by the poor and not the other way round, because labour was cheap and could not be negotiated. However, social sector programmes like MNREGA had empowered the poor and the bargaining power of labour had gone up, he added.

“In a country where 35 per cent of the people are below the poverty line, should you be looking at only growth or inclusiveness? Without growth you cannot have any poverty reduction programmes,” he said, and added that in the next two years, India would be back to its former growth trajectory. He also stressed that poverty levels have come down in the last 20 years but the government needed to do more.

David Thomlinson, Global Head, Geographic Strategy & Operations, Accenture, said top priorities for India should be providing basic infrastructure, water, transportation, education, and health care.

Zia Mody, Senior & Founding Partner, AZB & Partners, said bureaucratic and political will is required to find solutions and India Inc was more than willing to engage with the government. n