The Indian experience is that every geographical area with opportunities for education has come out of abject poverty much faster. Kerala, Goa, Pudussery and Punjab are examples where progress in human development indicators were more on account of improvement in literacy than industrialisation. Looked at from a different angle, industrialised and urbanised states neglected education from a selfish interest to retain the uninterrupted flow of cheap labour from rural to urban areas.
The observation that "aid - generally politically motivated and conditional - is not effective and is 'likely to perpetuate and prolong poverty and not eliminate it', since fixing poverty is not as easy as fixing a broken car" is relevant in the current Indian context. Much of our problems have origin in our neglect of the strength of domestic institutions and resources and import of solutions that had lab tests in foreign soil and circumstances.
Perhaps, The Great Escape read with An Uncertain Glory by Amartya Sen and Jean Dreze could change the approach of our economists and policymakers.
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