The confusion around the Gujarat model

 

The proverbial "Gujarat development model" has indeed for long been a cause for heated debate among the intelligentsia. And remarks such as these, made by politicians in the heat of election campaigning, have only given the topic a fresh lease of life, with an equal number of economists and commentators lapping up the opportunity to either affirm or dismiss its genuineness in op-eds and on television chat shows.

As is always the case with any conversation that involves Narendra Modi, their views are incredibly polarised and thus becoming gradually more difficult to accept as genuine or balanced.

 

"No matter what the growth indicator, Modi and Gujarat come out trumps," says Surjit Bhalla for instance, a right of centre economist in his latest piece in the Indian Express. He compares Gujarat with 7 other states that had similar per capita incomes in 2001 and concludes that on all counts - from agriculture to manufacturing, wages of the disadvantaged to employment levels, Gujarat comes on top, and its growth model hasn't just benefitted the privileged few. His contemporaries like Bibek Debroy or the Jagdish Bhagwati - Arvind Panagariya combo are in  consonance with this view.

 

Their counterparts on the left of the ideological spectrum, however, like Prof Jean Drèze for instance, champion another notion entirely. Gujarat’s development achievements "largely predate Narendra Modi, and have as much to do with public action as with economic growth", Drèze writes in his Hindu op-ed titled 'The Gujarat Muddle'.

"The “Gujarat model” story, recently embellished for the elections, is misleading in at least three ways, Drèze says. "First, it exaggerates Gujarat’s development achievements. Second, it fails to recognise that many of these achievements have little to do with Narendra Modi. Third, it casually attributes these achievements to private enterprise and economic growth. All this is without going into murkier aspects of Gujarat’s experience, such as environmental destruction or state repression".

 

Drèze insists how as some of Mr Modi’s admirers have readily supplied an explanation for Gujarat’s dazzling development performance "more sober scholars (Raghuram Rajan, Ashok Kotwal, Maitreesh Ghatak, among other eminent economists) have shown, Gujarat’s development achievements are actually far from dazzling."

 

For a lay observer to cut through the propaganda on either side and discern who is actually "sober" and who isn't, has become virtually impossible though. You could either be reading about an egalitarian seventh heaven or about a land where the cult of cronyism rules roost, depending of course on what material you choose to pick up on Gujarat. The tragedy is that these are economists deriving different results by often slicing the same set of official government data.

 

The real problem then it seems is not the Gujarat model so much - the truth about it will invariably lie somewhere in the middle. It is the politicisation of economics as a profession (that began several months ago when Bhagwati - Panagariya bickered publicly with Nobel Laureate Amartya Sen over the Gujarat model) that's more of a worry. Because the stark binaries created around Gujarat's economic reality while providing political factions with enough material to make their fallacious arguments, has kept the voter confounded and far far away from the truth.