Apr 27, 2014

What is Modi's Gujarat Model Exactly?

Now, you may have heard many times about Modi's Gujarat model of development. What it is about? Is it any useful to country or it is just a hype? How do you decide about it?

No one with right mind can say that Modi will implement all policies of his state. As a enable leader, he will decide about anything based on the situation. But MoneyControl has published an article about What is Gujarat model all about. Excerpt from there:

Going by the agri-GDP growth registered at state-level during the 2000s, Gujarat tops the list with 9.8 percent per annum growth, up from a meagre 2 percent during 1990s.

Compare this with the Kerala model, where agri-GDP growth has been zero for the 2000s (down from 1.3 percent during 1990s). Or with UP or Tamil Nadu or West Bengal models, all of which registered less than 3 percent growth in agriculture during 2000s.”
Gujarat environment is business-friendliness.

There is economic freedom. What is it? Read the article. Link is given below.
Gujarat has topped the Economic Freedom of States in India rankings for the third time in a row.
Gujarat has the lowest “Muslim rural poverty rate among all states. Its overall poverty rate for Muslims (11.4 percent) was far lower than for Hindus (17.6 percent).”
Herein lies the critical differentiator with Gujarat. Both Maharashtra and Tamil Nadu did better than Gujarat on the overall growth story, but Gujarat has excelled in agriculture. What it has done is applied trickle down economics to agriculture – and it has worked.
Aiyar’s conclusion: “Gujarat has good governance. It has social and communal flaws. But it is India's top state in economic and agricultural freedom. That's not hype.”
HDI (Human Development Indicator) is low when think about developed state. It is in middle of the rank in country. It is above Karnataka but lower than Kerala, TN, and Maharashtra.

Clearly, this is where the Gujarat model of trickle down is not good enough to lift the really poor – socially and economically – out of their misery quickly. Here, Modi’s critics do have a point. Gujarat ranks 11th among 23 states in HDI .

Gujarat’s tribal population is nearly 15 percent of the total (14.79 percent, to be exact), which is nearly twice as large as Maharashtra’s (8.87 percent) and more than twice as large as Karnataka’s (6.55 percent), or Andhra Pradesh’s (6.53 percent). Tamil Nadu and Kerala, the states with far better human development indicators than Gujarat, have barely 1 percent tribal population.

The return on investment in public enterprises has doubled under his tenure to seven percent, according to state audit reports. While Modi has hived off the state’s electricity utilities he has not privatised them for fear they will not care for non-creamy customers.”

Source: MoneyControl