Around thirty years ago, economic nationalism was broken by India by becoming a self-reliant nation. The economic foundation which was laid previously was restructured in 1991 with the liberalisation programme with the help of reform measures. This resulted in a market economy that was not only competitive but also proved to present a highly efficient growth model. The growth trajectory supported by the economic liberalisation gave the hope that the barrier of poverty will be removed and India will become a better nation economically.
Where Did Equity Go?
Even though the growth milestone was delivered just like an eCommerce provides courier delivery via services like VRL, the ineffectiveness of it was clearly visible in the rising inequity. Urbanisation became a growth trend in India but with the rural and remote areas out of focus, a crisis was seen and the gap between the rich and the poor people increased and the same was visible in the regional disparity.
Not all the states of India grew uniformly after economic liberalisation. Even though all the states welcome economic liberalisation, not everyone managed to taste the fruit of it. Many states of India remained underdeveloped and economically backward so much so that only a few renowned courier services like TCS are only able to provide their services. This was a result of political instability and infrastructural barriers that pulled back such states from economic development.
North-East Is An Obvious Example
The north-eastern states of India can be a perfect example of the problem that India faced after economic liberalisation. For a long period of time, the political movements in these states have proved to be problematic and were often contested. This resulted in the formation of different states in the post-independent period. States were created out of Assam under the North Eastern Area Reorganisation Act, 1971 and the process of the same was completed with the creation of Arunachal Pradesh in 1981.
With the exception of Assam, all the other states of North-East became geographically smaller. The implication of it was not only visible in the geography but also the economy of the states as it became economically impoverished. However, that did not draw the nation’s status for the much needed new economic vision for these states. However, back in time few of the policies which tried to help the northeastern states are the Look East Policy, North East Industrial and Investment Promotion Policy, North East Development Fund Corporation and Special Accelerated Road Development Programme- NE. These policies focused on infrastructure and industrial development which could ultimately lead to economic growth but more new policies need to be implemented.
What Is The Implication Of New Policy?
Looking at the economic condition of the North East, the Union Ministry of Development of the North-Easter Region was established to make these states an important part of the reform measures of the country. The first Vision Document 2020 introduced by this ministry focuses on a growth rate of 12.95% to catch up with the other states of the country. However, the policy failed to meet the aimed growth and the prime factor responsible for this failure was the political instability that exists in the north-eastern state. The political instability hampered the North-East to become a part of the economic liberalisation of the country. In the last three decades, not one single state of North-East could make its way to the top states of the country.
Even though the north-eastern state has a high resource base, its GSDP or Gross State Domestic Product has been low. In fact, from time to time, a decrease in the GSDP was visible. The rising gap of GSDP of the north-eastern states with other states highlights the problem of the regional gap between these states and the rest of the states. The numbers of GDP also reveal this regional disparity with North-eastern states never making it to the growth map of the country. For instance, Manipur has one of the highest poverty ratios in the country.
Financial investment in these states has been huge with the introduction of new policies like Act East Policy, North East Industrial Development Scheme and North East Special Infrastructure Development Scheme. However, the growth due to such policies has been very insignificant. Because the North-East states have always been the worst performer in the economy, it presents itself as the perfect anomaly of the economic liberalization process of India and this looks almost paradoxical in many ways.