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2016 | Buch

Economic Transformation and Development Experience of Indian Punjab—An Introduction Kapitel lesen Erstes Kapitel lesen

Economic Transformation of a Developing Economy

The Experience of Punjab, India

herausgegeben von: Lakhwinder Singh, Nirvikar Singh

Verlag: Springer Singapore

Buchreihe : India Studies in Business and Economics

Enthalten in: Springer Professional "Wirtschaft+Technik" , Springer Professional "Technik" , Springer Professional "Wirtschaft"

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This book traces the development experience of one of India’s most dynamic and prosperous states, Punjab, which has provided the country with a much-needed degree of food security. The relative regression of Punjab’s economy in the post-economic reforms period and slow current economic growth give cause for concern. The contributions in this book address the question of why the structural transformation of Punjab’s economy has fallen into the middle-income trap. Each investigates the policy constraints influencing the relative stagnation of the economy and suggests appropriate measures for alleviating them. By integrating theoretical constructs and new evidence, the authoritative contributions diagnose the nature of the current problems and offer practical solutions. They cover important issues such as the crisis of agrarian transition, agrarian markets and distributive justice, employment growth and transition to non-agriculture sectors, fiscal policy, external factors in economic transformation, and perspectives on rejuvenating the state’s economy.

Inhaltsverzeichnis

Frontmatter
Chapter 1. Economic Transformation and Development Experience of Indian Punjab—An Introduction
Abstract
This chapter presents the framework for economic transformation of a developing economy. It provides lessons that can be learnt from the changing structure of advanced as well as developing economies including India. The situation of Punjab economy and its problems are outlined in historical perspective. Attempt in this chapter is also made to provide the overview of contributions made by well-established scholars on Punjab economy. The chapter concludes with a note that Punjab economy direly needs economic transformation for an economically viable, ecologically sustainable and political and socially stable state of India. This chapter also brings out the emerging consensus on affirmative policy actions urgently required for sustained economic transformation of Punjab economy in twenty-first century.
Lakhwinder Singh, Nirvikar Singh

Understanding the Crisis of Agrarian Transition

Frontmatter
Chapter 2. The Role of Technological and Institutional Changes in the Growth and Transformation of Agriculture in Punjab
Abstract
The purpose of this paper is to examine the interrelationship between structural transformation in agriculture in one hand and its sustainable development on the other. In that process, the paper intends to bring out the interaction between institutions, technology and organizational changes in agriculture. Structural transformations are examined in terms of (1) changes in the size distribution of land holding and (2) changes in other productive assets such as livestock, agricultural machinery, and implements, irrigation. The paper will also look at the effects of structural transformation on (1) the fall in profitability in agriculture and its consequences on livelihood and in that process, the forced movement of labour from agriculture to non-agriculture, (2) over capitalization of agriculture and (3) the increased energy use and its adverse consequences on sustainable development.
K. N. Nair, Gurpreet Singh
Chapter 3. Growth Pattern and Economic Impacts of Wheat Productivity on Punjab Agriculture
Abstract
The present study makes an attempt to describe a simple strategy of how production of wheat increased manifold, strengthening food security in India, on the basis of past empirical evidence. The study uses the secondary data on wheat productivity and important inputs which are hypothesized to be its significant determinants spanned over the period 1970–71 to 2009–10. The simultaneous equation model was used to estimate various parameters. Expansion in irrigated area resulted in larger area under high yielding varieties of wheat in order to realize higher production and profits. In Punjab, the elasticity of wheat area with respect to cropping intensity was very high at 0.68 and that of irrigation was about 0.6 (through cropping intensity). Expansion in irrigation helped in significantly increasing wheat production in the state. The average productivity of wheat in India can be raised by expanding irrigation in India. The yield gaps need to be bridged by targeted extension activities to encourage adoption of modern technologies including high yielding seeds, fertilizers and other inputs. The policy should therefore lay emphasis on the development of irrigation potential in the country. Secondly, the already created irrigation potential must be exploited fully through the maintenance of old irrigation infrastructure.
R. S. Sidhu, Kamal Vatta, Shayequa Zeenat Ali
Chapter 4. Rethinking Diversification of Agriculture in the Indian Punjab: An Examination of Strategy and Mechanisms
Abstract
In the context of new questions being asked of agriculture globally like its environmental impact, livelihoods of those involved and new agribusiness orientation of the sector with corporate interests coming in, the issue of diversification of Punjab agriculture has come to the centre stage once again though it has been around for almost three decades by now. This paper reviews the logic of diversification, its rationalization in the state agricultural programmes and now policy (first agricultural policy of the state), mechanisms used and aspects neglected. It also examines the larger political economy context in which diversification is being attempted. Finally, the paper discusses the way forward in terms of reorientation of policy and institutions to move towards achieving more sustainable farm and rural sector livelihoods.
Sukhpal Singh
Chapter 5. Groundwater Irrigation in Punjab: Some Issues and a Way Forward
Abstract
This chapter examines the state of groundwater balance in Punjab and suggests strategies to make it sustainable. The author notes that the net irrigated area is predominantly under tube well irrigation, that is, 71 %. Therefore, the pressure on groundwater for fulfilling irrigation needs in Punjab is very high. The groundwater table is receding at a rapid rate. Out of 137 developmental blocks, 112 are overexploited so far as groundwater is concerned. These blocks belong to the central part of Punjab. The author notes two significant factors that have determined the overexploitation of groundwater: one, the scarcity of surface water, especially canal water for irrigation and two, groundwater has advantage in terms of control over the timing and amount of water. The welfare implications in terms of rising costs of lifting water from the aquifer and falling water table are having negative effects on agricultural production.
Rita Pandey

Agrarian Markets and Distributive Outcomes

Frontmatter
Chapter 6. Growth of Cash Rent Tenancy and Modernisation of Land Lease Market in Punjab
Abstract
The nature of farm tenancy in Punjab has completely changed due to the technological revolution and commercialisation of agriculture; traditional share tenancy has been replaced by modern cash rent tenancy. The tenancy laws of the state, however, have not changed to keep in tune with the emergence of modern tenancy. This chapter argues that the existing tenancy laws need to be replaced by a new set of modern tenancy laws to facilitate the smooth, costless and hassle-free transfer of land for cultivation from less efficient to more efficient farmers. The focus of the new tenancy laws should be on creating zero risk of land loss through renting out, easy and costless registration and enforcement of lease contracts, promotion of long lease contracts and enabling the tenants to get institutional credit on the basis of rented in land.
H. S. Shergill
Chapter 7. Marketing System and Agricultural Development in Punjab
Abstract
This chapter examines the output disposal and its impact on agriculture development of Punjab. An important feature of the output market is that the storage capacity for the food grains, both covered and open, was 234 lakh tonnes in the year 2013–14. It also provides evidence regarding how the regulated market assigned a special role to commission agents as intermediaries. These agents are often involved in the money lending business, and trap the farmers in this interlinkage to extract farmers’ surplus. These commission agents are thriving because the APMC Act of 1961 prohibits direct sale of food grains. However, it is also pointed out the lack of modern food grain storage facilities as a contributory factor in this situation. It is suggested that the government should develop, perhaps through public–private partnerships, new safe storage capacity (such as silos), so that wastage of food grains can be prevented in the future.
M. S. Sidhu
Chapter 8. Agricultural Credit in Punjab: Have Policy Initiatives Made a Dent in Informal Credit Markets?
Abstract
Agrarian credit markets have been at the centre of policy intervention in India since the beginning of the last century, when the cooperative movement was launched in an attempt to provide an institutional alternative to the exploitative moneylenders. Yet, providing adequate and timely institutional finance to farmers continues to be one of the most intractable problems. The focus of this paper is on the agrarian credit markets in the state of Punjab, once labelled as India’s most successful experiment in agricultural development. However, the state has now been caught up in a severe agrarian crisis, with indebtedness of farmers and their ensuing suicides occupying centre stage. This is symptomatic of the alarming dominance of informal lenders engaged in exploitative practices through interlinking the credit market with output, input and labour markets, and the failure of the institutional credit set up to thwart such practices. The study thus traces in general the growth trajectory of the agrarian credit structure in Punjab, while also reflecting on the presence of interlinked credit transactions. The features and impact of such transactions have been documented using empirical data from a revisit microstudy carried over a twenty-year period in a single district of Punjab.
Anita Gill
Chapter 9. Imperfect Information and Contract Enforcement in Informal Credit Market in Rural Punjab
Abstract
The paper studies the screening, monitoring and enforcement mechanism of the commission agents in rural informal credit market of Punjab. The commission agents due to imperfect information invest considerable time and efforts to screen the borrowers. However, the time invested and efforts made in screening are not the same in all the regions, and the moneylenders from a region with less number of default cases invest lesser time and make fewer efforts to screen the borrower. Though the legal system is used as an enforcement mechanism in many cases, the moneylenders do not consider it efficient. The social norms and other informal mechanisms are often used to enforce the contract, even though the effectiveness of these methods is found low in regions with large number of defaults. The farmer unions, in some cases, are reported to have obstructed the contract enforcement and also played a role in renegotiation of the contract. The study also argues that the use of informal methods of enforcement, which are instigated by inefficient legal enforcement rather than their low cost, may result in inefficiencies.
Indervir Singh
Chapter 10. Household Income Inequality and Asset Distribution: The Case of Rural Punjab
Abstract
The present paper examines the asset and income inequality in rural Punjab by using two different datasets pertaining to 315 and 290 rural households during 2005–06 and 2010–11. The study reveals a widespread inequality in land ownership as well education in rural Punjab. There has been a significant decline in access to various income sources during the study period with relatively richer households having access to more number of income sources than their poorer counterparts. There was a huge difference in the share of different income quintiles across various sources of income reflecting a widespread income inequality, which seems to have increased further in the recent times. The overall Gini coefficient has shown a small increase from 0.46 to 0.49 during 2005–06 to 2010–11. A further increase in such inequality in the recent times is a matter of concern for more careful planning towards an egalitarian society in the long run.
Kamal Vatta, S. Pavithra

Structural Transformation of Punjab Economy: Emergence of Industry and Services

Frontmatter
Chapter 11. Growth, Employment and Structural Change: Punjab Versus 16 Major States of India
Abstract
This paper studies the decomposition of GSDP growth per capita in Punjab via-a-vis 15 other states in India during 1993–94 and 2011–12 in terms of employment and productivity growth. Specifically, it focuses on the role of employment growth and structural change in employment on economic growth. It reviews the theoretical rationale, presents the growth patterns in GSDP and employment, and estimates the employment-productivity components of GSDP growth per capita using the Shapley decomposition analysis. The results show that Punjab has slipped in terms of GSDP per capita over this period but structural shifts have paid off well in terms of diversification of the economy and their contribution to labour productivity especially for manufacturing. Overall employment effect had been negative but this was essentially due to contraction in the labour force; the employment rate effect turned out to be positive. Finally, while the state was outpaced by other states in terms of growth rate in GSDP per capita and even employment, structural change in the economy has been a positive feature of growth in the state.
Aradhna Aggarwal
Chapter 12. Manufacturing Sector in Punjab: Evolution, Growth Dynamism, Key Concerns and Rejuvenation Strategy
Abstract
Despite being the agrarian economy, the state of Punjab has witnessed a rapid growth of sound manufacturing sector that catered not only the domestic needs but its products contributed significantly to export markets. However, the growth trajectory has not been smooth. In the recent past, Punjab’s manufacturing segment received setbacks that resulted in a slow growth in both absolute and relative sense. This study along with tracing historical evolution of manufacturing sector in the agrarian state of Punjab examines its growth, since 1970–71, in comparison to the states of Haryana and Himachal Pradesh. It also provides a comparative assessment of Punjab’s industrial policy framework vis-à-vis that was adopted by the states of Haryana and Himachal Pradesh.
Varinder Jain
Chapter 13. Service Sector and Economic Growth in Punjab
Abstract
Punjab, a state in northern India, has been a leader in Green Revolution in the past four decades. Punjab followed an agro-centric model of development that provided higher income levels to the people of the state and the much required food security to the whole country. Now the negative externalities of the model of development have started appearing. As one of the fallouts of this model of development, compared to some other states of the country, the service sector has not been able to catch up due to some inherent impediments in the system. The emerging service sector in the economy is an outcome of new policy regime and legacy the development model followed. To transform the economy from a stagnant to a vibrant one and making the service sector an engine of growth, analysis of growth and tertiarization is the need of the hour. In this context, this chapter is an attempt to analyze the structure, pattern, and growth of the Punjab economy with special reference to the service sector.
Inderjeet Singh

Human Development in Punjab’s Economic Transformation

Frontmatter
Chapter 14. Critical Evaluation of Educational Development in Punjab
Abstract
Paper focuses upon various facets of educational growth in the state of Punjab. Attempt is to build a critical perspective on educational growth story of state so as to indentify actionable points. Both census and survey data have been used to assess the quantitative and qualitative dimensions of educational build up. Analysis proceeds by exploring overall progress, gaps, and imbalances in educational growth in both absolute and comparative contexts in inter-temporal and inter-spatial manner. Composite picture has been developed by comparing and contrasting the educational growth across regions, neighboring states, subregions, sexes, locations, age cohorts, and other relevant social and economic categories. Inner dynamics of educational progress has been captured by collating vital educational indicators such as examination results, learning outcomes, education levels, and non-completion rates, etc. The analysis shows that education sector of state demands far more serious policy attention than hitherto in order to address quality and quantity concerns.
Jaswinder Singh Brar
Chapter 15. Economic Development and Emerging Health Scenario in Punjab: A Need for State Support and Accountability
Abstract
This chapter has scrutinized the relationship between economic development and the health status of the Punjabi population. On the basis of empirical evidence, it is argued that the adoption of the new economic policy in 1991 reduced public investment support to the health sector and increased the involvement of international agencies such as the World Bank. These agencies provided investment with a condition of allowing greater participation of the private sector in health and medical services. Consequently, the rise of private health and medical services has increased out-of-pocket health expenditure of households, which has made it difficult for the poor to access health and medical services.
Sukhwinder Singh

External Factors in Punjab’s Economic Development

Frontmatter
Chapter 16. Unpacking the “Diaspora-Development” Mantra: Does Punjabi Diaspora Have the Potential to Contribute to the Rejuvenation of Punjab’s Economy?
Abstract
Punjabi diaspora is now over 2 million strong and ranks as one of the oldest of the “free” Indian regional diasporas with a history of over 125 years. Given this long history, large segments of this diaspora are economically, socially and politically well settled and positioned in their adopted countries. This paper tries to unpack the current economic relationship between Punjab and its diaspora. An attempt is made to assess the current and potential contribution that Punjabi diaspora makes or can make to the Punjab economy by examining the motives, aspirations and abilities of the main factors involved. It will also consider, taking examples from other diasporas, how and why Punjabi diaspora’s potential contribution continues to be poorly mobilised and underutilised. It is argued that a major reason for this is the absence of a constructive engagement between the state government and diaspora communities, despite the populist rhetoric emanating from both.
Shinder S. Thandi
Chapter 17. How Centre–State Relations Have Shaped Punjab’s Development Pattern
Abstract
Situating the argument in the larger theoretical framework of the impact of external factors in shaping the development of a country or a region, this article explores the impact of Centre–State relations in India on shaping Punjab’s agrarian-oriented development pattern. It links this agrarian-oriented development pattern in post-colonial Punjab with the colonial era development pattern in Punjab that was based on the development of canal colonies in Punjab as the core of that development strategy. To show the continuity between the colonial era development strategy and the post-colonial development strategy, the article focuses on the Green Revolution as the central component in the shaping of agrarian-oriented development pattern in Punjab. The article concludes with arguing for restructuring Centre–State relations to give a push to decentralised development strategy in India that can allow Punjab to shape its own development pattern in consonance with its own resource endowment and its own transitional path to a non-agrarian future.
Pritam Singh

Fiscal Policy of Punjab in Comparative Perspective

Frontmatter
Chapter 18. Public Finances and Development: The Case of Punjab
Abstract
Punjab presents an odd combination of a relatively high-income state with a state level public finance that has been under stress for a long time. This paper looks at the trends in broad fiscal aggregates and a limited amount of disaggregated information to establish the pattern and locate the causes of the persistent stress. It examines fiscal balances, both the receipts and the expenditures side, the link between fiscal balances and indebtedness on the one hand, and between the stock of debt and revenue expenditures through the interest liabilities on the other. To establish a context, it also assesses the fiscal performance of Punjab in relation to other major states of India. It concludes with policy imperatives that have implications for not only the fiscal balances of the state, but also for the development of the real economy of Punjab that has begun to show signs of a slowdown.
Tapas K. Sen
Chapter 19. Strategy for Fiscal Stability and Revitalizing the Economy of Punjab
Abstract
The economy of Punjab has experienced a definite deceleration in the past two decades, which became evident in its falling rank in terms of per capita income amongst Indian states since the beginning of this century. Also, fiscal imbalances have afflicted the State in the past three decades and fiscal reform measures taken up after the enactment of Fiscal Responsibility Legislation did not have a lasting effect. In fact, debt sustainability is a major challenge before the Government of Punjab. The situation is not irretrievable, only the government has to put its act together. A multi-pronged strategy is required to rejuvenate the State economy as also to restore its lost glory. On the one hand, fiscal reform measures are required to be implemented in order to enforce discipline in the management of state finances in Punjab, on the other, overall economic development has to be taken up in all sectors of the economy.
Upinder Sahwney

Perspectives on Rejuvenation of Punjab Economy

Frontmatter
Chapter 20. Peasant Movement and Rejuvenation of Punjab’s Economy
Abstract
The revival of dynamism of the Punjab economy is going to be multi-dimensional in nature. In this effort, multiple sections have to be involved and emphasized. Peasantry is one of such sections as it has been most adversely affected and the major part of it is under stress. The involvement of peasantry in this process, especially for building fresh dynamism in agriculture is possible through their organizations. A consensus can be built on acceptable agrarian agenda. For the last three decades, several attempts have been made in the name of diversification of agriculture but the efforts have not been successful. One of the reasons for diversification not taking-off has been lack of involvement of peasant organizations in arriving at an acceptable agenda of agrarian change. In order to understand this, a genesis has to be made of the derailment of the vision or perspective of agrarian agenda commonly developed by the peasant movement during the 1970s and 1980s. The paper attempts to relate the state’s New Agricultural Policy, peasants’ vision and emerging agrarian situation in the state.
Sucha Singh Gill
Chapter 21. Breaking the Mould: Thoughts on Punjab’s Future Economic Development
Abstract
The economy of Punjab state in India offers an interesting case study. Punjab has been for decades––and remains––one of India’s better-off states, and so it tends not be included in the primary focus of national programs meant to reduce poverty or spur economic development. But, Punjab’s relative economic position within India has declined rapidly in recent years. This decline has been accompanied by environmental problems and symptoms of deep social malaise. As will be argued in this chapter, Punjab is facing a multidimensional crisis that requires urgent attention. This chapter provides an overview of Punjab’s crisis, through an analysis of the dynamics of Punjab’s economic development as shaped by its political economy, its social dynamics and exogenous events since independence. It argues that one can understand both Punjab’s success in certain areas of agriculture and its subsequent relative decline in terms of the interaction of these factors. It uses this historical analysis to provide an assessment of Punjab’s future economic development, in terms of the structural changes that are needed, and how these can be encouraged or implemented by policy makers within the constraints of its current political–economic equilibrium.
Nirvikar Singh
Backmatter
Metadaten
Titel
Economic Transformation of a Developing Economy
herausgegeben von
Lakhwinder Singh
Nirvikar Singh
Copyright-Jahr
2016
Verlag
Springer Singapore
Electronic ISBN
978-981-10-0197-0
Print ISBN
978-981-10-0196-3
DOI
https://doi.org/10.1007/978-981-10-0197-0

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