G-20 redefines growth
Besides good intent and lofty goals to revive the sagging growth, one of the significant aspects of the recent G-20 summit is redefining the very concept of growth.
The dominant paradigm was that growth would automatically eliminate poverty. But, as the UNDP observed, removal of poverty would automatically enable growth
Besides good intent and lofty goals to revive the sagging growth, one of the significant aspects of the recent G-20 summit is redefining the very concept of growth. The growth fun- damentalists have always held that growth per se is enough. According to this conservatism, the growth will automatically percolate to the lower levels. But the experience worldwide reveals that there are many an imper- meable membranes to block the flow of fruits of growth.
This led to ex- treme concentration of wealth and hu- mongous inequalities. The dominant para- digm was that growth would automatically eliminate poverty. But, as the UNDP ob- served, removal of poverty would auto- matically enable growth. Now, even the G-20 acknowledges this. Thanks to global recession new think- ing has dawned on such a forum. The G-20 Brisbane summit communiqué calls for raising global growth to de- liver better living standards and qual- ity jobs to be the highest priority.
This is much more significant at a time when the world is witnessing jobless and even job loss growth. The em- phasis on quality jobs is too under- lined. The Approach Paper to Twelfth Plan also said th at the Eleventh Plan period delivered mainly low quality and contract employment. Therefore, enduing and durable employment is a key imperative to ameliorate the conditions of impoverished masses. This is not just an egalitarian objec- tive alone.
It is sound economics as such a strategy would boost the demand which itself is now declared as an objective of G-20. Such a strategy is much more relevant for India that en- joys a demographic dividend. Ab- sence of such a strategy, as the Plan document itself observed, would lead to a demographic nightmare. The speculative global finance is dampening productive investment. Given this experience, the G-20 call for greater public and private invest- ment into infrastructural sectors is a welcome development.
As India told earlier G-20 summit, it can absorb a trillion dollar invest- ment in infrastructural sector. Thus changed global investment pri- orities would come in handy for India’s de- velopment. Huge skill deficit in the market on one side and unemployment on the other is leading to colossal wastage of human resources. Knowledge economy cannot accept this.
Therefore the G-20 summit rightly empha- sized skill formation. The job market is also riddled with inequalities; the most pervasive one is the gender based inequalities. The G-20 mem- bers agreed to the goal of reducing the gap in work participation rates between men and women by 25 per cent by 2025. But these postulates should translate into policy actions.
The reforms process would be inclu- sive only if these actions deliver re- sults on ground. To borrow the phrase used by UNDP, some are on main line while others are on loop line. This trajectory at the domestic or in- ternational level is unacceptable. Even the G-20 echoing this sentiment is a happy augury