RBI focusing on delivery and governance issues, says Leeladhar

Reserve Bank of India RBI deputy governor on Monday said delivery and governance issues were the focus of all policy actions undertaken by the central bank to eradicate poverty.

In his inaugural address at the RBI-UNDP (United Nations Development Programme) training programme on "Human Development and States Finances" in Pune, he said most areas related to human development indices are resource intensive and fall under the purview of state governments.

However, states are serverly constrained by fiscal issues and find it very difficult in raise the bar of its human resource. Reversing this situation will need creative solutions that will address the problem of poor delivery, he said.

Another concern, he pointed out, was rising inequality of income-the rich becoming richer and the poor poorer. The medium term assessment of the Tenth Plan acknowledged the rising inequality as per capita agricultural GDP fell even as the overall per capita GDP rose.

The underlying causes of inequality may not be just economic, he said, adding that social structures as well as governance issues can perpetuate and even exacerbate inter-state inequalities.

The various dimensions and causes of inequality including access to education, health, clean water, bank credit and the social infrastructure, need to be squarely addressed not only to work towards better human development indices and but also the creation of a just society.

Where employment is concerned, the figures suggest employment may be increasing in the unorganised sector but, growing unemployment in the organised sector is cause for concern.

Last year the government took an important step in this regard by senacting the National Rural Employment Guarantee Act, 2004. The Act guarantees 100 days (per household) of work to every adult who resides in any rural area and is willing to do casual manual work at the statutory minimum wage and provides that only productive works shall be taken up under the programme.