Subbarao calls for inclusive growth

Stressing growth has to be inclusive, Reserve Bank of India Governor Duvvuri Subbarao on Thursday said otherwise it would have no legitimacy.

“Growth has no legitimacy if the bottom of the pyramid gets behind...It can be destabilising if the growth is not inclusive,” Subbarao said at the 13th L K Jha Memorial Lecture organised by the central bank here this evening.

Drawing attention to the ‘Occupy’ movement, the first anniversary of which was observed on Thursday, Subbarao noted the need for inclusive growth was not essential for developing societies alone.

The emergence of popular discontent leading to powerful ideas like the Occupy Movement, howsoever amorphous and ladder-less, has shown that concerns about inclusive growth stand true for the developed world as well, he said.

“Inclusive growth is a very deeply emotive issue,” the governor underlined. He pointed out that there are two conflicting views when it comes to sharing of the benefits of growth. While one view has it that the gains would “trickle down” to the least common denominator, the other view is a much more vociferous and activist one, which asks for interventions for the sharing of the gains.

The comments from the governor come as “inclusive growth” has become a buzzword in government, business and academic circles in the country. Those in support say a decade of high growth of over eight per cent has not resulted in tangible effect on the ground like poverty alleviation and human development indices.