Comments on: On Balanced Growth of India http://www.deeshaa.org/2009/04/10/on-balanced-growth-of-india/ Mon, 13 Feb 2012 05:41:09 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: plodder http://www.deeshaa.org/2009/04/10/on-balanced-growth-of-india/comment-page-1/#comment-142171 plodder Sun, 24 May 2009 01:51:37 +0000 http://www.deeshaa.org/?p=2028#comment-142171 Dear Atanu, I fully understand and accept your point that your ‘labor pull’ strategy is completely voluntary. That was certainly not my intention. But it definitely looks like I need to clarify my earlier statement. I am basically questioning the scenario in Case A where a direct focus on increasing agricultural productivity will lead to surplus rural labor and consequently increased rural-urban migration. The latter (namely migration) has certainly not happened in Gujarat (also see http://www.business-standard.com/india/storypage.php?autono=320640). I do agree that surplus rural labor is a logical consequence of increased agricultural productivity. However, agriculture also requires the same kind of reliable infrastructural support and inputs that industry needs, namely water, electricity, good roads, access to markets and so on. The Gujarat experience shows that reliable rural infrastructure has not only increased agricultural output but also led to a move up the agriculture value chain with the establishment of agro-based industries like rice mills, dairy farming, fisheries and the adoption of lucrative agricultural crops like fruits and vegetables. In fact, it has also led to the migration of non- agro based industry like diamond cutting from urban to rural areas. I think the availability of additional job opportunities in rural areas could very well be the reason for reduced rural-urban migration. Dear Atanu,
I fully understand and accept your point that your ‘labor pull’ strategy is completely voluntary. That was certainly not my intention. But it definitely looks like I need to clarify my earlier statement.
I am basically questioning the scenario in Case A where a direct focus on increasing agricultural productivity will lead to surplus rural labor and consequently increased rural-urban migration. The latter (namely migration) has certainly not happened in Gujarat (also see http://www.business-standard.com/india/storypage.php?autono=320640).
I do agree that surplus rural labor is a logical consequence of increased agricultural productivity. However, agriculture also requires the same kind of reliable infrastructural support and inputs that industry needs, namely water, electricity, good roads, access to markets and so on. The Gujarat experience shows that reliable rural infrastructure has not only increased agricultural output but also led to a move up the agriculture value chain with the establishment of agro-based industries like rice mills, dairy farming, fisheries and the adoption of lucrative agricultural crops like fruits and vegetables. In fact, it has also led to the migration of non- agro based industry like diamond cutting from urban to rural areas. I think the availability of additional job opportunities in rural areas could very well be the reason for reduced rural-urban migration.

]]> By: Atanu Dey http://www.deeshaa.org/2009/04/10/on-balanced-growth-of-india/comment-page-1/#comment-142146 Atanu Dey Sat, 23 May 2009 15:44:19 +0000 http://www.deeshaa.org/?p=2028#comment-142146 plodder, I am not proposing "pulling labor" out of agriculture. I am not in favor of pulling people out of anything that they are engaged in doing. If you read what I wrote, I said that if the manufacturing sector expands, and if the productivity of agriculture improves, <b>then</b> labor will move from agriculture to manufacturing. There is no coercion involved. Let's keep that at the forefront of our discussion. plodder, I am not proposing “pulling labor” out of agriculture. I am not in favor of pulling people out of anything that they are engaged in doing. If you read what I wrote, I said that if the manufacturing sector expands, and if the productivity of agriculture improves, then labor will move from agriculture to manufacturing. There is no coercion involved. Let’s keep that at the forefront of our discussion.

]]> By: plodder http://www.deeshaa.org/2009/04/10/on-balanced-growth-of-india/comment-page-1/#comment-142142 plodder Sat, 23 May 2009 15:09:07 +0000 http://www.deeshaa.org/?p=2028#comment-142142 you are proposing ‘pulling labor’ out of agriculture and into industry since the latter provides higher income opportunities as compared to the former. In this context, a recent report (http://economictimes.indiatimes.com/Opinion/Policy/Emulate-Gujarats-agricultural-success/articleshow/4493375.cms) about the success of the Gujarat Government’s Krishi Mahotsav based agricultural development model is well worth some consideration. The article virtually confirms Mr. Modi’s proclamations of achieving near 10% agricultural growth over the past 6 years in Gujarat since 2002. Farmers incomes have doubled during this period. The migration from rural to urban areas has also come down due to the availability of basic amenities like electricity and water. This experiment clearly shows that given the right kind of support and encouragement, agriculture can be a very promising income generating opportunity in its own right. you are proposing ‘pulling labor’ out of agriculture and into industry since the latter provides higher income opportunities as compared to the former. In this context, a recent report (http://economictimes.indiatimes.com/Opinion/Policy/Emulate-Gujarats-agricultural-success/articleshow/4493375.cms) about the success of the Gujarat Government’s Krishi Mahotsav based agricultural development model is well worth some consideration. The article virtually confirms Mr. Modi’s proclamations of achieving near 10% agricultural growth over the past 6 years in Gujarat since 2002. Farmers incomes have doubled during this period. The migration from rural to urban areas has also come down due to the availability of basic amenities like electricity and water. This experiment clearly shows that given the right kind of support and encouragement, agriculture can be a very promising income generating opportunity in its own right.

]]> By: adi http://www.deeshaa.org/2009/04/10/on-balanced-growth-of-india/comment-page-1/#comment-140154 adi Fri, 10 Apr 2009 18:38:44 +0000 http://www.deeshaa.org/?p=2028#comment-140154 Very interesting thoughts Atanu. But have you gone into details of each of these models -- details such as actual numbers on how much manufacturing GDP is required to pull out *enough* people from rural areas into productive engagements, so that rural agriculturalists are bound to improve their efficiencies? Numbers will be important for a sanity check on the appropriateness of a model. On the same track, I am always puzzled on how do governments actually compute numbers while designing policies. Do they go into economic modeling, behavioral modeling, etc, or do they just pull out numbers from their hat? Very interesting thoughts Atanu. But have you gone into details of each of these models — details such as actual numbers on how much manufacturing GDP is required to pull out *enough* people from rural areas into productive engagements, so that rural agriculturalists are bound to improve their efficiencies? Numbers will be important for a sanity check on the appropriateness of a model.

On the same track, I am always puzzled on how do governments actually compute numbers while designing policies. Do they go into economic modeling, behavioral modeling, etc, or do they just pull out numbers from their hat?

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