Monday, May 07, 2007

Rural prosperity

...doesnt win elections, says Swami Aiyar. Read the piece for some data that will throw light on how prosperity is, spreading, albeit slowly to the rural areas.

Agricultural growth has been very slow, and rural areas without connectivity have grown less than globally-connected cities. English-speaking urbanites have got high paid jobs while rural folks have not. Still, has prosperity bypassed villages?

Not at all, says the latest NSS survey. Between 1993-94 and 2004-05: lPer capita consumption of edible oils rose by 30% in rural areas, and 18% in urban India.

The proportion of rural households using cooking gas rose six-fold, from 2% to 11.7%, while the urban proportion doubled to 59%.

lThe proportion of rural households using electricity rose from 34% to 54%. The urban proportion rose from 74% to 94%. lPurchases of readymade garments rose by 75%, and of hosiery products threefold, in both rural and urban areas.

lRefrigerator use increased from 1% to 4% of rural households, and from 12% to 32% of urban households. lBetween 1999-00 and 2004-05, the proportion of TV households rose from 19% to 26% in rural areas, and from 59% to 66% in urban.

Clearly, rural areas lag well behind urban areas. But equally clearly, growth has not bypassed rural areas. Between 1999-00 and 2004-05, poverty declined from 26% to 22%. That is, 44 million people rose above the poverty line. This did not help the BJP electorally. Clearly, neither GDP growth nor poverty reduction wins elections. More than 80% of incumbents are voted out in India.

The NSSO has data on the poorest of the poor: those who say they go hungry in some or all months of the year. Between 1993-94 and 2004-05, the proportion of rural households hungry at some time in the past year fell from 5.5% to 2.6%. More than half the once-hungry in rural areas ceased to be so. In urban areas hunger almost vanished: the proportion of hungry households fell from 1.9% to 0.6%.

Food for thought? Heres the full report.

(Cross posted on The Indian Economy Blog)

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