|The World Bank has emphasized how India was able to achieve an annual growth rate exceeding seven percent for the last 15 years. / Photo by africa924|
India has halved its poverty rate over the last 15 years and achieved a seven percent growth rate since the 1990s, reports international financial institution World Bank.
The bank, which provides grants and loans to the governments of poorer countries for the purpose of pursuing capital projects, said that India plays a “critical” role in the success of international development efforts. Examples of this would be India’s help to alleviate extreme poverty. The country has likewise served as an influential leader in terms of addressing climate change.
India’s economic growth
The World Bank has emphasized how India was able to achieve an annual growth rate exceeding seven percent for the last 15 years. It also has strong improvements in human development outcomes. In economics, human development seeks to understand why and how people of different circumstances and ages remain the same or change over time. The Human Development Index (HDI) is used to measure the actual progress in human development. The HDI is a composite statistic of per capita income, education, and life expectancy indicators used to rank countries.
The report further shows how India’s growth will continue and how extreme poverty can be eliminated in a decade. Yet, this does not mean that the nation will not face challenges as part of its development trajectory. This is why India needs to have “greater resource efficiency” to be able to sustain its growth, considering its large population and resource endowments.
|ndia has halved its poverty rate over the last 15 years and achieved a seven percent growth rate since the 1990s. / Photo by clicksabhi via Shutterstock|
Ways to sustain its growth
The World Bank noted that lands in rural areas need to be used productively to increase its agricultural productivity and in urban areas by spatial transformation to achieve “agglomeration economies.” It refers to the benefits of combining housing and output in certain areas. An example of an agglomeration economy is Silicon Valley in California, wherein IT setups cluster in a way that attracts highly skilled IT personnel.
Water management in India is another point highlighted by the World Bank as one of the ways to sustain its growth. It said that the water allocation system should be shifted to higher-value policies and uses to increase its value within industries. There are also about 230 million people in India that are not appropriately connected to the electrical power system or electrical grid and there is a need to reduce carbon emissions in electricity generation.
The international financial institution also sees the country’s need for investment in the infrastructure industry, which is at an estimated 8.8 percent GDP or $343 billion every year until 2030 in support of its growing economy.
There is likewise a need to modernize the public sector in India. By modernization, they mean creating regulations that match the ambition of a middle-income nation. This entails improving the effectiveness, ability, and accountability, of the state to join forces with the private sector. Doing so will help strengthen the force among government tiers.
Sustained growth also requires the need to create better and more jobs. Every year, there are about 13 million people in the working-age population in India but only three million new jobs are generated yearly. The challenge is the decreasing number of female workers joining the labor force. India’s female labor force is only at 27 percent and is one of the lowest globally although the country has already overcome the gender gap in its education system.
Global Hunger Index
India’s Global Hunger Index (GHI) score, which is a tool that tracks and measures hunger globally, by region, and by country, also shows how the country is improving. It has decreased its rank from 95th in 2010 to 102nd this year out of the 117 nations compared. A total of 17 countries, including Kuwait, Cuba, Ukraine, and Belarus, are in the top rank with its Global Hunger Index score less than five. In the GHI point scale, 0 is the best score (no hunger) while 100 is the worst. Values 50 and above reflect extreme and alarming hunger levels.
The GHI was prepared by Irish aid agency Concern Worldwide and German organization Welt Hunger Hilfe. The report indicates that 9.6 percent of all children in India between 6 and 23 months old are fed a “minimum acceptable diet.”
The World Bank also details the share of the population in India living in extreme poverty from 1990 to 2016. Data was computed by measuring per capita household consumption and adjusted for inflation and price differences across countries. In 1993, 45.90 percent of India’s population was living in extreme poverty. It decreased to 38.20 percent in 2004, 31.10 percent in 2009, and 20.10 percent in 2011.
Some countries that were hit hardest by poverty were also included by The World Bank. In Mozambique, for example, 62.90 percent of its population was living in extreme poverty in 2014. 49.70 percent of people in Mali lived in extreme poverty as of 2009, the most recent data gathered by The World Bank.
The decline of extreme poverty is a good thing, not only in view of one country, but globally. Gradually, it shows hope that strategies are in progress to end starvation and hunger for good.