Regional variation in growth and development

Regional development disparity is a continuous developmental challenge for Indian policy makers. It has been in existence since the British period. During the first three decades of planning, the government gave much stress to establishing heavy industries in backward regions but this problem remained unabated. The accelerated economic growth since the 1980s appears to have aggravated regional disparities.

The ongoing economic reform since 1991 with stabilization and deregulation policies as their central pieces seems to have further widened the regional disparities because the benefits of economic growth after economic reforms were not distributed equally among the states.

From many studies, it is clear that the development of any region depends upon natural resources, human resources, etc. But in spite of the availability of such kinds of resources, many regions remained still backward like Orissa, Bihar, and Jharkhand, etc. Thus in India, the process of development has not been determined by the availability of these resources alone; political and social factors are also important for the development.

BASIC CAUSES:

Historical factor:

The British government and industrialists developed only those regions of the country which possessed rich potential for prosperous manufacturing and trading activities. Thus port cities like Bombay, and strategically important areas like Calcutta and Madras received initial development.

Geographical Factors:

Himalayan states like Himachal Pradesh, Northern Kashmir, Uttarakhand, North-Eastern states remained mostly backward due to its inaccessibility and other inherent difficulties.

Location Specific Advantages:

Due to some locational advantages like availability of irrigation, raw materials, market, port facilities etc. some regions are getting special favour in respect of site selections of various developmental projects e.g. oil refineries are mostly located in close to sea.

Early Mover Advantage:

Term-lending institutions and commercial banks tend to concentrate investments in the relatively more developed States.

Failure of Planning Mechanism:

lack of adequate resources, poor implementation of plans, lack of planning capacity at state level reduced capacity of Planning Commission to ensure balanced development.

the benefit of green revolution were restricted to Punjab, Haryana and western Uttar Pradesh as this belt had advantage of irrigation facilities, were traditionally wheat growing states, with adequate policy support from State Governments which other areas lacked and couldn’t reap benefits of Green Revolution

INTRA REGIONAL DISPARITY:

An important aspect of regional disparities in India is the significant level of disparities, which exist within different States. For example, Vidarbha in Maharashtra.

Backwardness of certain regions in Gujarat, Madhya Pradesh, Bihar and Orissa can be associated with the distinct style of living of the inhabitants who are mostly tribals and the neglect of such regions by the ruling elite.

POLICIES TO REDUCE DISPARITIES

Some of the policies adopted by government includes:

Higher resource transfers from the Centre to the Backward States

Development Programmes like Programmes of agriculture, community development programme, Drought Prone Areas Programme, irrigation and power, etc.

Provision of Facilities in Areas which Lag Behind Industrially like river valley project.

Programmes for the Expansion of Village and Small Industries:

Central and State Governments are made available in the areas according to programmes undertaken.

Diffusion of industrial activity and infrastructure:

Subsidies, exemptions and tax breaks given to industries for investing in backward regions. For instance North East Industrial and Investment Promotion Policy (NEIIPP 2007) .

CONCLUSION

India is subdivided into 29 states differing in terms of their productive potential and the type of industry they can support. The realization of their potential holds the key to increasing the competitiveness of the nation as a whole.

India’s geographical diversity and different levels of development across regions mean that location specific targeted action would be required in less prosperous regions to ensure that a minimum acceptable level of prosperity.

The sustainability of the growth rate and the goal of the country to achieve its development target will be difficult to meet unless India develops as an integrated whole of regional competency.