Focus on roads, water, health will give masses feel of robust economy (Interview)

October 29th, 2008 - 3:00 pm ICT by IANS  

New Delhi, Oct 29 (IANS) In these times of uncertainty, improved access to basic infrastructure like roads, potable water, health and education will give India’s poor masses the feel of a robust and expanding economy, a top economic advisor has said.”Roads, drinking water and sanitation facilities, schools, colleges and health centres are some of the basic public goods where improvement will benefit the masses in general,” said Arvind Virmani, chief economic advisor in the finance ministry .

“It will give them the feel of an expanding economy - an economy that has grown at an average pace of 9 percent in the past four years and one that will log nearly 8 percent growth this fiscal despite the global meltdown,” Virmani told IANS in an interview.

Nearly 70 percent of India’s billion-plus population lives in rural areas, where basic infrastructure facilities are largely considered to be in need of massive upgradation.

About 50 percent of the villages are without roads, while only around 6,000 community healthcare centres have specialists - a far cry against the stated requirement of at least 21,000 professionals.

“On the public goods front, perhaps we are not doing everything that needs to be done. Things are, however, changing,” said Virmani, who has a doctorate in economics from the Harvard University under the supervision of Nobel laureate Kenneth Arrow.

“There is a gradual change in the last 10 years. The focus has shifted gradually to some of the basics - roads, drinking water, sanitation - where the difference is being felt,” he added.

The government has in the past 10 years launched a number of centrally sponsored programmes to build up basic infrastructure in rural areas. For example, the Pradhan Mantri Grameen Sadak Yojana (PMGSY) is engaged in refurbishing rural roads.

By 2009, the government intends to connect all habitations with a population of 500 with all-weather road. This entails constructing 146,185 kilometres of rural roads that will connect nearly 70,000 habitations, he said.

There was also a special initiative to build basic infrastructure for sustained water supply - the Accelerated Rural Water Supply Programme (ARWSP) under which 420,000 rural habitations were provided with safe drinking water provision during 2004-08.

“It is the poor who need the basics. So, a focus on basics will automatically benefit them the most,” said Virmani, adding that there were two aspects about economic growth, both of which were part of the government’s slogan of inclusiveness.

“One aspect of economic growth is increases in income and demand for labour. Second is the supply of basics and quasi-public goods to the masses,” he said, pointing out that from 1980 onward, the per capita income growth had trebled.

“The poverty level has gone down to nearly 25 percent from 40 percent during this period. Clearly, we are doing better than earlier. Still a lot needs to be done.”

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