Food Policy Think Tank Releases New Report India's Economic Hype is at Odds with Reality
Food Policy Think Tank Releases New Report India's Economic Hype is at Odds with Reality
FOR IMMEDIATE RELEASE
May 05, 2004
CONTACT: Nick Parker
(510) 654-4400, ext. 229
As the world's largest democracy goes to the polls, a new report shows how India's decade-long 'economic miracle' has hurt some of the world's poorest people
(Oakland, CA)- The Indian government and the World Bank have lauded India's economic performance. But a new report from Food First/Institute for Food and Development Policy shows that this performance has touched only a sliver of the population and bypassed the majority of farmers, India's economic backbone.
The report, "Shining India? Economic Liberalization and Rural Poverty in the 1990s," documents how economic growth rates over the past ten years mirrored rates from the 1960s and 1970s, when India did not participate in the global economy. But unlike then, the report paints a picture of increasing inequality and hunger in a time of plenty.
"Outside India, it's possible to believe the Indian government's claims that economic liberalization has brought higher income levels and a booming technology sector to which jobs are outsourced," said Dr. Raj Patel, Food First policy analyst and author of the report. "What people don't see is that 250 million Indians, one in four of the population, live below the official poverty line, and people don't hear about the increases in chronic malnutrition which have happened at exactly the same time as the tech boom."
According to the report, the technology sector only accounts for about 2 percent of the Gross Domestic Product (GDP), employing less than 1 million people while over 600 million people, nearly 60 percent of the population, remain in the agricultural sector. Over the period of India's economic liberalization, the gap between rich and poor has increased dramatically. The Gini Index used to measure inequality within nations rose from 30 to almost 38 between 1991 to 1997.
Using Indian government data, the report argues that increased inequality isn't just because the rich getting richer; India's poor are getting poorer. There are 20 million more people in absolute poverty than before neoliberalism began in 1991. Government data also shows that, at a time when there are more Indian billionaires and more outsourced jobs to India, chronic hunger is rising, reversing trends from the 1970s and 1980s.
Additionally, the Indian government has cut investment for rural development, leaving much of the rural poor without the necessary support to pull out of their plight. The report cites reductions in expenditures as a share of the GDP from 14 percent in the late 1980's to less than 6 percent in 2000. Yet this is where the majority of India's citizens live.
The report concludes that economic liberalization has not improved the lives of millions of rural Indians. But it has favored large commercial farmers, multinational corporations and urban service sectors while opening a wider gap between the rich and the poor.
To read the report, visit: http://www.foodfirst.org/pubs/policy/pb10.html
To speak with Raj Patel, contact Food First Media Coordinator Nick Parker at (510) 654-4400, ext. 229.
