Moving on from India@75 dreams

News: NITI Aayog had released her ambitious report titled India@75 in 2017. It was a 200 page document which had a total of 1400 stakeholders.

What were the targets of the document?

It aimed to take GDP growth to 8% and to raise the taxes to GDP ratio to 22%. It also aimed to increase the female labor participation rate to 30% and to improve data collection on employment. Furthermore, it aims to double the rate of growth of the manufacturing sector to make in India

What has been the achievement of the targets identified in the report?

GDP growth rate:  dropped from January 2018. For 13 quarters before the pandemic, it reached as low as 3.1% in 2019–20.

Investment rates:  remain static at 30% or below. Center’s tax to GDP ratio fell from 11% in 2019 to about 10% in 2020.

Labor force participation has remained similar at 40%. Whereas, LFPR In China and Vietnam is as high as 70%.

Data collection: A consumer expenditure survey was not released. The unemployment rate is at 6%.

Manufacturing and its share in GDP have fallen from 16% to about 13% today. Jobs in manufacturing have fallen. For example, in automobile production, the production remained 3.4 million passenger vehicles in 2014-15 and is the same in 2019-20. The society of Indian automobile manufacturers commented that the slow-down is long-term, structural, and deep.

Farmers’ income did not double, reserve bank of India’s consumer confidence survey has been trending negative for 5 continuous years.

There is only one positive outcome, that there is a rise in exports after being flat for the last five years.

What did the government do?

The government constituted a committee under former chief statistician Pronab Sen. Agenda of this is to improve the quality of data amid criticism of the government over political interference, but there have been no further developments on this front.

What should be the way forward?

As India approaches 2022, the report needs deep introspection before new targets are set.

Source: This post is based on the article “Moving on from India@75 dreams” published in Business Standard on 18th February 2022.