Marginalised Groups and Inclusive Growth

The existing ceiling on agricultural land holdings needs to be continued for preventing concentration of agricultural land into a few hands

The incidence of poverty has been most pronounced among the SCs, STs, and Muslims. According to the India Human development Report 2011, these groups suffer the most on account of poor health status

'Inclusive Growth' is defined in the 12th Plan document as a growth process that is broad-based or in which wider sections of population, especially those marginalized and hitherto excluded, participate.

'Inclusive Growth' so defined implies, among other things, stepping up GDP growth rate in the slow growing or less developed regions through the development of necessary physical and social infrastructure; greater priority to agriculture which contributes to food security and provides livelihood for nearly half the labour force in the country; and high priority to manufacturing so as to generate greater employment opportunities and ensure rise in wages.

It is recognized that setting sectoral priorities right is not sufficient for achieving inclusive growth. Marginalized groups can avail the opportunities for setting up enterprises and securing jobs in these sectors only when they have access to the resources like land and capital, education and skills without being subjected to various forms of discrimination.

Inclusiveness in Agriculture Growth

Let us first consider the issue of land in agriculture sector, the single largest employer of labour force including some of the most marginalized sections. Agricultural land holdings are becoming smaller and unviable. Over 85 per cent of farmers are now small and marginal. Area under cultivation will continue to decline because of increasing competition for land for non-agricultural uses like industrialization, urbanization and housing.

Redistribution of land to the landless in India, in the 1950s and 1970s, through the imposition of ceiling on agricultural land holdings was not significant as the land so distributed did not exceed 2 per cent of total area owned; even this meager land was of low quality and marginal. However, a major contribution of ceiling on agricultural land holdings has been to prevent the concentration of land holdings in the hands of a few large land owners and agri-business corporations.

Since the size of labour force dependent on agriculture in India is going be quite high for the next few decades, the existing ceiling on agricultural land holdings needs to be continued for preventing the concentration of agricultural land into a few hands. This is a necessary pre-condition for ensuring inclusiveness in agriculture growth, especially because there is no evidence, as yet, that small and marginal farmers cannot raise productivity in agriculture as effectively as large farmers, when adequate public support systems are in place.

However, given the ceiling on ownership holdings, tenancy needs to be liberalized so that those wanting to leave agriculture - whether large or small land owners - are free to lease out their land without fear of losing their ownership. This would enable those choosing to remain in agriculture to become viable by enlarging their operational holdings, provided tenants are ensured adequate access to credit from institutional sources through the Loan Eligibility Cards, as recommended by the Committee on Land Issues in Andhra Pradesh, headed by Koneru Ranga Rao, a Minister, in 2004.

It is clear from the Report of this Committee that a promising source for strengthening the land base of the most marginalized group like tribal population is to restore to them land illegally alienated from them which was estimated to be as high as 50 per cent of their land in Andhra Pradesh.

According to the Committee, if alienation of land continues at the present rate, tribals would soon become landless.

Social Inclusion - The present status

The incidence of poverty has been most pronounced among the SCs, STs, and Muslims. According to the India Human development Report 2011, the SCs, STs and Muslims suffer the most on account of poor health status: The most striking shortcoming of our public health system has been the failure to reach out to the bottom of the pyramid, to the 300 million people who are often excluded.

The problem of illiteracy in both rural and urban areas was most pronounced among SCs, STs, and Muslims, and relatively more pronounced among females. The Report points out that the combination of low public expenditure on both health and education has had serious, long-lasting adverse consequences for India's human development levels, and suggests that establishing publicly funded educational institutions alone can ensure greater participation from among the educationally disadvantaged communities.

Some recent developments

However, of late, there are certain encouraging developments in regard to social inclusion, a ray of hope, pointing to the possible factors responsible for such favourable outcomes and the direction in which policies can be focused for accelerating desirable changes. One good news, according to the Human Development Report 2011, is that all the three groups, that is, SCs, STs, and Muslims have been converging towards the national average in terms of literacy rate. Health indicators for these marginalized groups are also converging with the national average, although in absolute terms, the overall situation continues to be worrisome. Over the same period, that is, between 2004-05 and 2009-10, the unemployment rate among the workers belonging to these three groups declined in both rural and urban areas. Poverty has declined for these groups at an accelerated rate between 2004-05 and 2009-10 – which is higher than the overall or average annual rate of decline.

Basing on the data from the same source which covers a decade beyond what was captured in the Sachar Committee Report; the gaps between Muslims and the national average on most human development outcomes are narrowing, reflecting their improving condition. These encouraging developments should not come as a surprise. The year 2004 was a watershed after 15 years of economic reforms, when the government at the centre made an explicit commitment, for the first time, to implementing economic reforms with human face.

Among many policy initiatives taken in the social sector, two major ones are Mahatma Gandhi National Rural Employment Guarantee Programme and the Programme for the Welfare of Minorities. On all accounts, these two programmes had a distinctly better impact.

At the State level, according to HDR 2011, "the experience of Kerala and Tamil Nadu demonstrate that the 'destiny' of population can be changed through appropriate policies that address the needs of the marginalized communities.

The analysis makes a strong argument for all state governments to act as agents of change to make the development process truly inclusive". It may be noted that in both Kerala and Tamil Nadu, the system of Public Distribution of Foodgrains has been functioning successfully. These states also ensure better accountability of programme performance through Panchayati Raj Institutions.

Governance

The observations on governance in the 12th Plan document are worth mentioning as they are based on an in-depth analysis of past performance: "The experience with Plan programmes has clearly established

the central role of a socially mobilized and aware community as a decisive determinant of success....The states that have emphasized the role played by social mobilisation and have made specific financial and human resource provisions have, invariably, succeeded. It is the participation of users in planning, implementation and social audit of these programmes that has proved critical to their success".

But the basic issue is a political one of ensuring much quicker response of our democratic system to the needs and aspirations of the poorer and marginalized sections of society. The shift in policy towards economic reforms with human face and the strategy of inclusive growth adopted in the 11th and 12th Plans did represent the response of our democratic system to the growing discontent among the poorer sections. But the pace of change has been too slow, halting and even retrogressive some times because of the resistance from the vested interests.

(The writer is Chancellor, University of Hyderabad and Honorary Professor, CESS. This article is based on the inaugural presentation made by him at the National Seminar on "Economic Growth and Marginalized Groups: A Search for Inclusive Policy" held at the School of Economics, University of Hyderabad, on March 24, 2014)