Govt to make inclusive growth argument for economic reforms at NDC meet today

The central government is to tell state chief ministers at tomorrow’s meeting of the National Development Council, called to clear the 12th Plan document, that the economic reforms it has put underway have distinctly helped reduce inequality.

According to a Planning Commission analysis on the basis of official growth figures and Reserve Bank of India data, likely to form the basis of the government’s argument of inclusive growth in the United Progressive Alliance regime, the average yearly GDP growth of the bottom five states in the 10th Plan (2002-07) was 8.58 per cent and during the 11th Plan had reached 9.1 per cent, closer to the average growth of the top five states in the same period.

A senior government official said the analysis indicated strong evidence of inclusive growth at all levels, irrespective of which party was ruling a particular state.

Historically, what are termed the ‘BIMARU’ states (undivided Bihar, Madhya Pradesh, Rajasthan, Uttar Pradesh) grew more slowly than the others. However, this has reversed and these states are growing at close to or above the national average, he added.

The analysis says from 2001 to 2005, Gujarat was the fastest growing state, at 11 per cent yearly, and Bihar was the slowest at 2.9 per cent. Between 2006 and 2010, however, Bihar became the fastest growing, 10.9 per cent yearly, while Gujarat at 9.3 per cent was overtaken by as many as five others — Chhattisgarh (10 per cent), Haryana (9.7 per cent), Maharashtra (9.6 per cent) and Odisha (9.4 per cent).

In distribution of consumption growth in rural areas, the study shows a higher average during 2004-05 to 2011-12 as compared to the 1993-94 to 2004-05 period, and has been also more inclusive, said the official.

Average real consumption growth in urban areas was also higher in the second period and more inclusive, according to the analysis.