POLITICAL ECONOMY IN INDIA 3/5 (1)

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Dr.  Raju Kalmesh Sawant

M.A. B.Ed, M. Phil, Ph.D 

Assist. Professor (Dept. of Political Science)

N.D.Patil Night College, Sangli

Email Id: rajusawant444@gmail.com

Contact No: 09890207898

 Abstract –

India has a wonderful way of turning traditional theories of economic growth on their head. Take the theory of diversification among sectors (agriculture, industry and services) as the driving force of development. Based on the historical evidence of western societies in the 19th and early 20th centuries, the ‘stagist’ view of development was considered the best way forward.  Once the share of agriculture in a nation’s GDP had dipped in comparison to industry or services, then surely a desirable structural change was afoot.  The trajectory of development meant an inevitable pre-eminence of Services over industry and agriculture. By that token, the last two decades, we are told, have been testimony to a trajectory of growth appropriate to western societies; judging by GDP numbers at least, India has done exceedingly well. In the Economic Survey of 2010-11, the Finance Ministry gave us a retrospective view on the change in the relative importance of the three sectors.  In 1950-51, the share of services in GDP was around 30.5 per cent; this jumped to 55.2 per cent in 2009-10. If construction is added, the share climbed to 63.4 per cent. The “ratcheting up of the overall growth rate (compound annual growth rate or CAGR) of the Indian economy — from 5.7 per cent in the 1990s to 8.4 per cent in the period between 2004-05 to 2009-10 — was in large measure due to an acceleration in the CAGR in services from 7.5 per cent in the 1990s to 10.3 per cent in 2004-05 to 2009-10.”

Key Words: Diversification, Pre-eminence, Ratcheting, Acceleration etc.

Full Paper 

  1. INTRODUCTION

The development of India’s economy was based on socialist-inspired policies after independence. It included state-ownership of various sectors, regulation and red tape which was known as ‘Licence Raj’ and protection from the world markets. The Political Economy of India has rapidly changed with the liberalization of the economy in the 1990s. It has now moved towards a market-based system and is the world’s second fastest growing major economy after China. India recorded the highest GDP growth rate of 9% in 2007.  The growth rate has reached 7.5% in the late 2000s. The country is the world’s twelth-largest economy by (PPP) purchasing power parity adjusted exchange rates. It is ranked 118th by PPP and 128th on per capital basis in the world. The most important priorities for India according to the World Bank are public sector reform, agricultural, removal of labor regulations, infrastructure, rural development and reforms in backward states.  The liberalization of India’s economy was initiated by Prime Minister Rajiv Gandhi in the 1980’s. In 1991, the International Monetary Fund (IMF) bailed out India through a $1.8 billion loan when it faced a crisis on defaulting on its loans. During this time, Prime Minister P. V. Narasimha Rao and his finance minister Manmohan Singh initiated new reforms.  The new reforms led to easier international trade and investment, privatization, deregulation, inflation-controlling measures and tax reforms. Liberalization has been the same irrespective of which party headed the government. But no party has yet thought of reforming labor laws and reducing agricultural subsidies which may anger powerful lobbies like trade unions and farmers.

OBJECTIVES OF THE STUDY

To study the political economy of green growth in India.

To study the need of political economy in Indi

3. THE POLITICAL ECONOMY OF GREEN GROWTH IN INDIA

Political economy is the study of the role of economic processes in shaping society and history.  Political economy (particularly when the word “radical” is added as an adjective) has come to be closely associated with the work of economists who adopted key concepts developed by Marx, in particular his focus on class processes or relationships, but who rejected the economic determinism of orthodox versions of Marxian theory.  Thus, political economy makes extensive and intensive use of class analysis in making sense of society and history, but does so in the context of political, cultural, and environmental processes, as well as other economic processes.

Rapid economic growth in India during the last two decades has accentuated the demand for energy and natural resources related to water, land and forests. Based on a review of the current policy framework in these areas and data from fieldwork in the northeastern region of India, this paper addresses two inter-related themes: (i) how emerging economies like India have dealt with the question of access to resources in response to the opposing demands of “inclusive growth” and more equitable development aimed at closing “social divides”; and (ii) the specific case study of two seemingly contradictory development trajectories, namely the “Green Mission” and hydroelectric power (HEP) dams on the river Teesta in India’s northeastern Himalayan region. The authors’ review of the policy agenda for water, land, forests and river dams suggests that current approaches toward growth have largely privileged a mainstream development perspective, promoted privatization and often aggravated existing social inequalities. The effectiveness of the so-called “green” or sustainable development approaches has largely been compromised due to their mainstream and increasingly noel liberal orientation conceptualized within a primarily techno-bureaucratic policy framework.

  1. NEED OF POLITICAL ECONOMY
                                        Although the study of political economy has a long and proud history, its importance has grown over the past several decades. Recent developments such as the dramatic changes in the price of oil and other minerals, currency value fluctuations, the impact of regional and international trade agreements (such as the World Trade Organization (WTO) and the North American Free Trade Agreement (NAFTA)), as well as the shifting dynamics within major international groups such as the G-8 and the G-20, have initiated some of the most profound changes in Canadian political and economic governance since Confederation.

At the global level, the impact of the financial crisis of 2008, growth slow-downs in all major industrialized countries of the world, the economic rise of China and India, and the challenges of regulating international flows of people, goods, funds, and technology, have fueled an increasing interest in international political economy. The consequences and challenges posed by the subsequent restructuring will have to be researched and studied for years to come. The Political Economy degree program offers students these opportunities by introducing you to this fascinating field.

Additionally, transformations wrought by globalization as well as the new information and communications technologies (ICTs) make it vitally important that students understand both local political and economic relations and their connections to global change. Thus, the Athabasca University degree program in Political Economy is designed to provide students the knowledge and practical skills necessary to meet the profound challenges of the 21st century.

  1. CONCLUSION

Political processes and economic change are deeply intertwined in a globalizing world and recognition of their linkages is crucial for understanding the role of any government in economic activity.  The politics of India’s economic growth, state welfare, and development experience, situating it within a larger framework of globalization. It outlines the complex yet inevitable dependency of public welfare on the growth process, pointing out the Indian state’s successes and failures on developmental fronts. It evaluates the main political factors impacting India’s nearly three-decade-old engagement with economic reforms, globalization, and development.

  1. REFERENCES
  1. Sajay Ruparelia, Sanjay Reddy, John Harriss & Stuart Corbridge (eds), Understanding India’s New Political Economy, Abingdon: Routledge, 2011.
  2. Sanjeev Sanyal, The Indian Renaissance: India’s Rise after a Thousand Years of Decline, New Delhi: Viking Penguin India, 2008. Excellent overview.
  3. Govindan Parayil, (ed.), Kerala: The Development Experience: Reflections on Sustainability and Replicability, London: Zed Books, 2000.
  4. Niranjan Rajadhyaksha, The Rise of India: Its Transformation from Poverty to Prosperity, Hoboken, NJ: John Wiley & Sons, 2007.

 

 

 

 

 

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