Reviving Indian economy: More ideas from the grass roots

Recently I had suggested many interventions for boosting demand in a distributed manner.  The measures included persuading employees in the organised sector to get no or low -interest advance from their employers eligible for certain tax concessions, to buy the annual stock of clothes, grains and other necessities.  I will add that if they pay for certain other facilities through a tie-up with online marketeers, the capital would move from bank and employers to a large number of consumers.  That will give a boost to demand agriculture and food processing sector, health insurance and other service providers.  

In addition, the processed food industry, toy and small machine goods could also get a boost.  Government has so far relied on making corporations stimulate demand by having more capital in their hands.  I wish out of the ten per cent tax cut, at least one per cent had been earmarked to be spent on internal and external R&D for reducing the cost of production, conserving energy and reducing waste.  By not influencing the nature of consumption and therefore the kind of economic growth, we are trading off long term sustainability with short term gain.

The corporate  sector needs to be  persuaded to internalize climate change and other long-term sustainability implications.  The Rural economy can bring new consumers in the market for income elastic goods which will have a positive effect with a lag on income elastic goods also.  For example, if you buy a fridge now,  then you may buy perishable food products also later.

Under the employment guarantee scheme, the average number of days of employment was  49.61 against a promise of at least 100 days. After 2010-11, a record high of 257 crore person-days of work was generated.  If we rigorously allow public works on private lands for creation of farm ponds, soil conservation work, mulching, in-situ water conservation through repairs of farm bunds, making of animal shed, compost pits, cleaning and deepening of drainage channels, tree plantation, even value addition, etc., then next year’s productivity will get a major boost.  Since farmers will supervise these works and can be asked to supplement the wages if necessary by 10 – 15 per cent, the quality of the work would also be better.  In drought-prone areas and desert, such works will help reduce the migration next year.  Providing health insurance to all the workers, health checkup, insurance and preventive health care will further reduce the disease burden and improve productivity.  Simultaneously, education on awareness for the safety of the workers can also be provided to reduce health hazards.  The repair of government schools, creation of playgrounds, improving water sanitation provision can also be supplemented.  Since many of these works will be done on private land, the conventional opposition from the farmers’ lobby for increasing MGNREGA investment will also be avoided.  In the 150th year of Mahatma, there can be no bigger tribute than skilling and improving the wellbeing of workers, conservation of water and environment and improving the productivity.  All the pending payments should be cleared immediately and the average wages of about Rs 200 need to be revised upward. 

Ropeways in hill areas mainly for goods should be considered an essential part of transportation policy and must be provided at a very large scale reduce the drudgery and get farmers better price for the products and services.  Creation of these culverts will improve productivity ecosystem has and reduce losses due to artificially created floods.  The entire canal network needs urgent desilting and repair work to reduce seepage and waterlogging in certain locations.  There is an urgent need for a National Commission on Agriculture, Health and Watershed development to bring synergy among various sectors of the economy.  One can even add education and employment in terms of reference of the proposed commission. 

The author is founder of Honey Bee Network & visiting faculty at IIM-A 
anilgb@gmail.com