India’s economy hit a major turning point in 1990 when the government started the Economy Liberalization. Its effect is the significantly high economic growth when the GDP greatly rose from $316.9 (1990) to $1001 (2010), but along with that, it also brought about the increasing poverty and the widening income gap. After 1990, poverty, religious conflict, corruption, income inequality and regional disparity are the main problems facing India’s economy while Bollywood and IT sector and software service became the highlight of India’s economy. Speaking of India, we can relate to one country, China because of their similarity in population, their growth in GDP and several historical links. Despite having many things in common, they focused on different development paths. While China’s main focus is manufacture and infrastructure, or in short : hardware, India excels in Service and technology : software. So, because of those features, a tight partnership with strong potential is called Chindia.
In this report, I will expand my thought on the regional disparity in terms of literacy, economic distribution and healthcare sector and regional income convergence of India.
Up to 2011, India has seen an improvement in Literacy rate when it rose from 65.38% (2001) to 74.04% in 2011. The government has taken several measures to improve the literacy rate in rural areas, so by 2011, the gap between urban and rural areas has slightly declined, but the gap still remains relatively large with Kerala being the state with the highest literacy rate (94%), followed by Lakshadweep (92.3%) and Mizoram (91.06%) and lastly Bihar with the lowest literacy rate (64%). In spite of the government’s providing free education programs to poor people living in rural areas, the amount of schools and education centers are still not very considerable compared to urban areas and the people in poor villages, town could not get access to free education because they are not aware of that (media isolation). Also, about 42% of the population of India live on less than $1.25 a day, especially in rural areas, there are a large amount of people below the poverty line. That’s why education becomes unreachable for them.
The considerably high economic growth of India seems like it only benefits the rich in the high-income states.
While convergence between countries is a crucial issue in the analysis of a country’s economy, regional income convergence – convergence between regions of a given country is also very important. Regional convergence are defined by observing that whether initially poor regions have a tendency of developing faster than initially rich regions. In the case of India, Manipur which in 1961 had real per capita income of below-averaged level (1,438) and grew relatively fast (3,893) in 1991 was catching up to Delhi, the highest income state in 1961 (6,236) which had the close growth rate until 1991 (10,177). Therefore, there is regional convergence in India. According to an article by Paul Cashin, the regional convergence between initially poor states and initially rich states is the rate of 1.5 % per year. Nevertheless, this speed of regional convergence is slower when compared to Japan, USA … – the industrial countries earlier.
India is famous for its healthcare system which fulfills the needs of metropolitan cities only if they are able to afford it. Based on a report by the United Nations, 75% of the health infrastructure in India is used to serve in urban areas where account for only 27% of India’s population. Whereas, the rural areas which account for 72% of the population (around 716 million people) lack the basic medical treatment. Manpower including doctors and medical specialists is one of the fundamental components of the healthcare system and rural areas are now lacking an estimated number of 12300 doctors (64%), which is six times lower than in urban areas. Moreover, the number of beds in hospitals is 15 times lower than in urban areas. Also, urban areas (specifically high-income states) have access to more amount of hospitals, dispensaries, expenditure on medical and public health as well as vaccines and instrumental medicine.
In short, healthcare resources distributed by the government are available to more people in urban areas than those in rural areas. This disparity has led to a series of difficulties and problems for rural areas. Life expectancy of people in rural areas are much lower than in urban areas. Crude death rate (8% compared to 6%) and still birth rate (9% compared to 8%) are both higher in rural areas. Infant morality rate is the most notable because rural areas account for 61%, more than 24% when compared to urban areas. The number of malnourished and underweight children in rural areas is also higher than in urban areas. The healthcare disparities has created more and more clusters of regions with poor infrastructure and this made rural areas much more vulnerable to diseases and contagion, which then creates greater burdens in treatment cost for the government.
The healthcare disparity has a strong relation to the literacy disparity and economic disparity stated above. Because health is a crucial factor in school attendance, the healthcare disparity has prevented people and children in rural areas from having a decent, healthy education’s time. Lacking health care means that not many people in rural areas can have the ability to learn efficiently and effectively. Also, because investments in health and education can lead to a higher future income, these disparities in literacy and healthcare sector can harm the rural areas’ economy further more. Therefore, without implementing a proper and immediate policy, the widening gap between rural and urban areas may get bigger in the future.