India has been declared the sixth largest economy in the world with a Gross Domestic Product (GDP) of USD 2.59 trillion as evaluated by World Bank and USD 2.61 trillion as evaluated by International Monetary Fund (IMF). India displaced France from this position in 2017 and is expected to further climb to the fifth place displacing the UK this year. It would then be next only to the USA, China, Japan and Germany. And yet, most of the economists feel that there is tremendous ground to over. Among the prominent ones who feel so is Mr. Rajeev Kumar, Vice Chairman of NITI Aayog, himself. NITI (National Institution for Transforming India) Aayog is Policy Commission of Government of India, working towards formulating economic policy for SDGs (Sustainable Development Goals). And these SDGs cover social and economic development issues including poverty, hunger, health, education, climate change, gender equality, water, sanitation, energy, urbanization, environment and social justice, among others.
It does not really take an economist, but for the statistics and semantics befitting an economic news, to state that India is yet to see growth as desired. Majority of the common Indian citizens, who struggle through the routine social and economic challenges staring them in the face, would promptly point out the intensity of irrelevance they see in this development from the perspective of their experiences in daily life.
What then is the hallmark of growth? Rise in GDP (Gross Domestic Product), rise in per capita income, increase in FDI (Foreign Direct Investment), increase in employment opportunities, increase in savings potential, decrease in fiscal, revenue and trade deficits, decrease in debts, decrease in population density, drop in consumer price index, drop in inflation, decrease in prices of essential commodities, decrease in fuel prices, drop in electricity prices, access to clean drinking water, decrease in income inequality, decrease in taxes, development of transport infrastructure, affordable healthcare and education, increase in speed of delivery and quality of social justice, decrease in crime rate or something else or something more or all of it? Considering that growth is all of it may seem idealistic but impractical in the rather discrete scalar view of growth.
When businesses look at growth, it is largely profitability. Governments look at it as improvement in the economic indicators. And masses look at it as increase in their living standards. All these, however sharply defined and measured, still form isolated scalars which are so simultaneously correlated and contradicting that an increase in growth of one comes more often than not, at the expense of that in the other. The commonest example is that of auto industry which has been constantly complaining against lack of infrastructure growth holding back its own, despite high potential and performance. Another one is that of subsidies in agricultural and rural sectors widening deficits and debts. While imposing high duties to curtail imports may lead to increased costs in domestic manufacturing, allowing duty exemptions may bring down domestic production.
These rigorously contradicting scalars, therefore, would never be able to give growth as desired. The only way out is to view them as component vectors, growth being their resultant. An increase in automobile production would then be termed as growth provided it is accompanied by an appropriate development in infrastructure or decrease in fuel prices or increase in other renewable energy refill options again with appropriate infrastructure and all such other correlated growth determinants, which actually enables realization of intended benefits to consumers. Thus, resultant would be ‘balanced growth’ vector.
It is not national growth, as declared by economists and institutions, that matter to masses so much as its relevance and resonance with their individual sense and experience of affluence. And these experiences cover the entire gamut of activities and facilities they consider as the real indicators of growth over their entire lifespan. The vector of growth needs to be defined and measured considering these experiences.