Editorial Discussion

28-December-2023
Vision
India@2047
• GS PAPER III
• Indian Economy and
issues relating to
planning, mobilization of
resources, growth,
development.
 Vision India@2047

● Context: In early 2024, the Indian Prime

Minister is expected to unveil the Vision
India@2047 document to transform India into
a developed nation with a $30 trillion
economy by 2047.
● India’s Economic Growth: India’s rise from 1991,
when it accounted for 1.1% of the global
economic output, to 3.5% and currently as the
world’s fifth largest economy, has been driven
by reforms and liberalization agenda.
● Further, India is aiming for a 9% growth
rate between 2030 and 2047.
 Vision India@2047

● Rising India’s Importance: India is a critical

player in almost every major issue facing the
planet.
● The Ukraine crisis has shown that great
powers are desperate to count on India as
an ally.
● Further, there will be no successful solution
to climate change without India.
● Need for Vision India@2047 Document: This
document is under development to ensure that
India does not slip into a middle-income trap
in the future.
 What is India’s Vision for 2047?

● Vision 2047 Document: India Vision 2047 will cover

government process re-engineering, global
engagement, implementation roadmaps, and
measures to avoid the middle-income trap.
● The document will also include plans for creating
global leaders, addressing regional disparities,
and developing human capital.
● Middle-Income trap: According to the World
Bank, the middle-income trap refers to a
situation whereby a middle-income country is
failing to transition to a high-income economy
due to rising costs and declining competitiveness.
What is India’s Vision for 2047?
 What is India’s Vision for 2047?

● Formulation: The strategy for achieving the

objective was started in December 2021 and is
being prepared by NITI Aayog.
● Major Themes for 2047: These include
infrastructure, welfare, commerce and industry,
technology, and governance.
● Adaptability: This document will outline the
necessary changes and reforms to achieve the
goal.
● Timeframe: The Vision 2047 document has action
points and outcome goals into two periods viz.
2030, and the 17 year-period from then till 2047.
 What is India’s Vision for 2047?

● Opinions: The NITI Aayog will soon share its

central ideas and goals past top minds including
World Bank President, Apple chief, as well as
Indian industrialists and thought leaders, to
make it more better.
 What are the Strengths of India?

● Significant Demographic Dividend: India is home to more than 600

million people aged between 18 and 35, with 65% under the age of
35.
● India’s demographic dividend is expected to persist until 2055–
56 and peak around 2041.
● Vibrant Democracy: India is the largest democracy in the world with
a population of around 1.44 billion people, of which around 945
million voters.
● In a world where big and small nations are breaking into micro-
entities, India has demonstrated its inherent resilience. This
strength comes from its composite culture, making India a
vibrant democracy.
 What are the Strengths of India?

● Resilient Economy: Resilient economies are flexible at

both macro and micro levels, and there is abundant
evidence that the Indian economy has become more
resilient since liberalization 30 years ago.
● The multiple shocks suffered by the global
economy in the last 15 years have generated
considerable international discussion of
resilience. India’s rapid post-COVID recovery
also provides some encouraging pointers.
● NITI Aayog has forecasted that India’s economy
will be worth $30 trillion in 2047, with a per
capita GDP of $17,590.
 What are the Strengths of India?

● Diplomacy: In this digital age, it becomes

important for countries like India to employ
public diplomacy as a responsible power.
● India is adopting a public diplomacy policy that
can effectively communicate the nation’s story to
foreign audiences.
● India was ranked 28th in the Global Soft Power
Index 2023 report making it the second year in
which the country has featured in the top 30
countries.
 What are the Strengths of India?

● Sustainable and Inclusive Development: Over the

last decade, India has been a frontline
contributor to the fight against climate change
and has surfaced as a global economic power.
● For instance, at the COP26 summit, India
committed that it would achieve ‘net zero’
carbon emissions by 2070.
● The launch of ‘Mission LiFE’- Lifestyle for
Environment, further pushed all Indian
citizens to come forward and take steps
towards an environmentally conscious life
setting.
 What are the Strengths of India?

● Technology and Innovation: India is making

advances in healthcare not only through
infrastructure development but also by
employing Artificial Intelligence (AI) to its best
use.
● The use of AI in agriculture has proved to be
a game-changer with over 7000 farmers
using AI to monitor the health of their crops,
control quality and test their yield.
 What are the Challenges Faced by India?

● Lack of Inclusivity: According to the 2024 Asia-Pacific Human Development

Report, India has persistent disparity and widespread disruption.
● Amidst rapid growth but persistent disparity, the income distribution has
become skewed.
● For instance, the top 10% of the population gets 57% of national income
and the top 1% gets 22%.
● Various factors drive this persistent wealth divide. For example,
globalization and technological advances have created new
opportunities for some groups while leaving others behind.
● Further, the legacy issues are a high proportion of the non-agricultural
labor force in the unorganized sector and the proportion of women’s time
devoted to the care economy.
 What are the Challenges Faced by India?

● Global Uncertainty: Shocks arising from

geopolitical conflicts (Eg. Israel- Hamas conflict),
structural changes like the energy transition, etc.
will limit greater labor market flexibility and
mobility. This has implications for everything
from transport infrastructure to housing markets.
● Lack of Trade Openness: Protectionism in rich
countries under the guise of environment
leakage is an emerging risk, even as
traditional supporters of a rules-based
trading system are less interested in
defending it.
 What are the Challenges Faced by India?

● Breaking Lower Middle-Income Country Status: India

continues to grow but this current trend growth will
not be sufficient to reach its goals to reach middle-
income and eventually high-income status.
● For instance, to become a middle-income
country, India needs 80% high prosperity
(measured at PPP terms) compared to where the
country is today. It means a $7 trillion economy,
2.5 times the size of today.
● To become a high-income country, India would
need to become a $60 trillion economy, 20 times
the size of today.
 What are the Challenges Faced by India?

● Other Challenges: Risks to positive GDP

growth projections are predominantly
hindered by challenges which include
potential deterioration of banks’ asset
quality, delays in fiscal consolidation,
difficulties in trade agreements, and the
impact of below-normal monsoon seasons,
etc.
 Way forward: Road Map for Future

● Harnessing Demographic Dividend: Efforts are

needed to upskill millions of our working-age
youth nationwide to make them industry-ready
and future fit for the new sets of jobs that are
being created owing to the disruption of existing
business models.
● Acquiring relevant skill sets aligned to
futuristic goods and services such as
servicing robots, repairing augmented
reality (AR)/virtual reality (VR) devices,
and manufacturing chips would also be
useful going forward.
 Way forward: Road Map for Future

● Increase Spending in Education Sector: The

Government spending in the education sector in
India has been under 3.5% of the GDP,
compared to a global mean of about 4.5% of
the GDP. India needs a calibrated increase of
the education sector’s budget from the current
levels to match global levels with a focus on
spending efficiency.
● The new National Education Policy (NEP)
2020 is an effort in this direction, and
implementing this policy is the need of the
hour.
 Way forward: Road Map for Future

● Inclusive Growth: The labor force participation

rate (LFPR) in India is around 40% compared to
over 74% in Spain and around 75% in Portugal.
The primary reason for this low LFPR is the
absence of women from the workforce in India,
which has a female LFPR of around 20%.
● Women earning and proactively
participating in the workforce positively
impact a family’s prosperity, can help
eradicate poverty and strengthen the
journey towards building a prosperous,
safe and healthy India@2047.
 Way forward: Road Map for Future

● Unlocking Manufacturing Potential: India has been aspiring to grow

its manufacturing sector to account for 25% of the economy from the
current levels of around 15%. The recent supply chain shocks owing to
the pandemic and fractured geopolitics present a unique opportunity
to India to dominate this space.
● The Production Linked Incentive (PLI) scheme has been launched
to benefit from this growth wave.
● Simultaneously, India needs to focus on new-age manufacturing in
the areas of space, telecom, renewables and metaverse devices.
● The National Skill Development Mission should also work towards
making such skills available for the new-age manufacturing
sector.
Resolving regional
disparities

• GS PAPER III
• Indian Economy and issues
relating to planning,
mobilization of resources,
growth, development.
 Resolving regional disparities

● There is an oft-repeated analogy that

compares the size of certain Indian states with
that of European nations.
● It is not just the size of India that stands out;
the heterogeneity within this vast landscape is
noteworthy.
● India has traversed an exciting trajectory,
especially in the post-reform period.
● One of the many characteristic features of the
economy is considerable variation in the
growth performance, both across as well as
within Indian states.
 Resolving regional disparities

● The economic growth rate across Indian states

started diverging more from 1990 onwards.
● Over time, states with a higher per capita
income in the peninsular region have
significantly outdone states with lower
incomes, such as Bihar and Uttar Pradesh.
● In the past decade, the GDP growth rate in
southern states ranged between 5-6%, whereas
most northern states remained at 2-3%.
 Resolving regional disparities

● These spatial variations stem from a mix of

underlying historical factors, different
demographics, geographic conditions, and
policy decisions.
● The Indian economy today is at a sweet spot.
● We are at the helm of an economic boom while
the rest of the global economy is shrinking.
● In crafting the way ahead for India to emerge
victorious from this dichotomy, leveraging our
spatial heterogeneity to our advantage is
essential.
 Resolving regional disparities

● There are important questions that need to be

raised.
● What are these patterns of convergence and
divergence across the country?
● How can India overcome the challenge of
evenly sharing prosperity?
● What is the role of technology and governance
in reducing spatial disparities?
 Resolving regional disparities

● An analysis of data from the past decade

reveals that disparities in per capita income
have been on the rise.
● For instance, among the major southern states,
Karnataka registered a remarkable 7.07%
growth rate between 2010 and 2020 and
continues to grow promptly.
● The average growth rate of southern states falls
around 6.31%.
● A similar analysis of major northern states
shows wide-ranging disparities.
 Resolving regional disparities

● Barring Haryana, the best-performing state in

terms of GDP growth rate is Punjab at 4.15%
and the average growth rate of major northern
states over the past decade is around 4.5%.
● According to RBI data, in terms of GDP per
capita, Goa is 9.6 times more prosperous than
Bihar.
● In a similar vein, Maharashtra’s per capita net
state domestic product in 2021-22 stands at
Rupees 1,38,490 and Uttar Pradesh’s at Rupees
43,420.
 Resolving regional disparities

● These differences are further pronounced at the

district level. Districts within a certain state vary
in terms of their contribution to the state’s GDP.
● To illustrate, in Maharashtra, four districts—
Mumbai, Thane, Pune, and Nashik— collectively
account for over 50% of the state’s GSDP.
Notably, Mumbai alone (including Suburban)
directly contributes about 20% to this total.
● In contrast, in Uttar Pradesh, Gautam Buddha
Nagar holds the highest share, representing
8.91% of the state’s GSDP, while the remaining
65 districts collectively contribute less than 4%.
 Resolving regional disparities

● These district level differences extend to a

number of parameters.
● For example, the district with the highest
prosperity boasts an average wage 18 times
greater than the least prosperous district.
● Looking through the lens of export
competitiveness, among the 680 exporting
districts, the top hundred districts contribute
approximately 87% of India’s total exports.
● Notably, within these hundred districts,
exporting hubs are concentrated in the top-
performing states.
 Resolving regional disparities

● Furthermore, heterogeneity within states also

reflects on a range of social dimensions.
● If we consider access to water and functional tap
connections at the district level, of 680 districts,
all households in 105 districts have functional
tap water connections.
● On the other hand, 339 districts have less than
50% of households having functional tap water
supply.
 Resolving regional disparities

● Even at a sectoral level, spatial differences come

across starkly.
● In manufacturing, the southern states continue to
outperform their northern counterparts by a
difference of 2%.
● The difference is exacerbated as capital and
investments tend to congregate in these regions with
an edge, leaving several dark areas in the economy.
● Labour mobilisation patterns are also affected by
differential growth rates wherein migration from
regions with labour surpluses to regions with higher
productivity is now common.
 Resolving regional disparities

● Such disparities are seen in various indicators, along with the ones
mentioned above, including industrial development, infrastructure,
employment opportunities, and per capita income.
● This heterogeneity is both a challenge and an opportunity.
● Uniqueness of particular regions can be leveraged by formulating
effective strategies and policies that address the unique needs and
challenges faced by different regions.
 Resolving regional disparities

● As India moves forward in the age of

competitive federalism, states have a pivotal
role to play as drivers of development, and to
facilitate their active participation, national
policies should take cognisance of the spatial
disparities and address development in all its
dimensions across the country.
● Development is no longer about economic
growth, and India has been at the forefront of
achieving sustainable development in the
economic, social and environmental dimensions.
 Resolving regional disparities

● The good news is that social indicators,

including health, gender equality and
education are converging faster than economic
aspects, but there is still a barrier to translating
the convergence in social indicators to broader
economic development and vice-versa.
 Resolving regional disparities

● Any analysis of the Indian economy is

incomplete without touching upon its
demographic dividend.
● Investments in quality education and skilling
can go a long way in improving productivity
outcomes and creating a pool of skilled workers.
● India is at its prime to engage the youth to reap
maximum benefits from the demographic
dividend before the population ages.
● Our economy is once again at a critical
juncture.
 Resolving regional disparities

● With the right mix of policy and economic measures, India can
overcome the regional disparities in development, which poses a
challenge to the economy and equitable development across the
country.
• Discuss the contributions of Atal Bihari Vajpayee to the development
of Nation. How Some elements of Vajpayee’s legacy continue to
impact contemporary Indian society and politics.

• India has witnessed growing divergence in growth rates and

prosperity levels between states in the post-liberalization period. In
light of this, analyze the key reasons underpinning the rising spatial
inequality. Also suggest policy measures to address this
developmental imbalance.
Remembering Atal
Bihari Vajpayee
On his birth anniversary, let's take a moment to remember the multifaceted
legacy of Atal Bihari Vajpayee - a poet, politician, statesman, and a
gentleman.
Early Years and Political Ascent
1 Determination
At the age of 33, Vajpayee became a member of parliament, impressing everyone
with his oratory and analytical skills, despite being one of the youngest in the house.

2 Diplomatic Gesture
Vajpayee’s respectful acknowledgment of Prime Minister Indira Gandhi’s courage
during a critical time demonstrated his statesmanship and integrity.

3 Political Fortitude
During a no-confidence motion, Vajpayee exhibited ethical adherence by choosing
not to indulge in any maneuverings, setting a rare example in the political
landscape.
Decisive Leadership
Pokhran-II & Kargil
War
Vajpayee's resolute
decisions during Pokhran-II
and Kargil War showcased
his unwavering leadership
and commitment to
safeguarding the nation.
Economic Reforms Telecom Revolution
Under Vajpayee’s Vajpayee's visionary
leadership, India policies ended the telecom
experienced significant monopoly, paving the way
economic reforms, leading for mobile connectivity,
to robust GDP growth, which greatly benefited the
lower inflation, and common people and
flourishing foreign foreign investors.
exchange reserves.
Legacy of Dignity and Kindness
1 Saraswati's Gift
Vajpayee was a true embodiment of
Saraswati, blending intellectual
acumen with tenderness, winning
the hearts of people through his
affectionate and empathetic nature.
2 Resilience
Adversities only fueled Vajpayee's
determination, driving him to accept
challenges and demonstrate
unwavering dedication to the nation
and its people.

3 Art of Governance
Vajpayee's unparalleled parliamentary journey reflected his art of governance,
transcending petty politics to focus on the long-term welfare of the nation.
Unmatched Ethical Standards

Democratic Values Leadership's Enduring Integrity

Vajpayee's resignation
Compass
after a one-vote defeat Vajpayee's principled
reaffirmed the strength of stand during times of
Indian democracy and set political chaos and ethical
an exemplary standard of dilemmas stood as a
integrity and guiding beacon for future
accountability. leaders to uphold moral
rectitude in public service.
Vajpayee's refusal to
engage in political
machinations irrespective
of self-interests
showcased enduring
integrity, inspiring respect
and admiration from all
quarters.