Touting Average Per Capita Income Rise Savage Amid Glaring Disparities

Our policy makers need to interact with the people travelling in general compartments of long-distance trains and find out from them how much they earn and the kind of education and healthcare they give to their children

It borders on the savage to celebrate the rise in average per capita income when deep-rooted and multifaceted disparities remain glaring in our country. As long as wealth and income inequalities persist in such a debilitating manner, we must refrain from rejoicing over figures that are so divorced from ground realities.

That said, we must also acknowledge that the incomes of some among us are rising rapidly, as they are able to benefit from India’s economic resilience. Meanwhile, the majority are either unable or unequipped to do so, largely due to the lack of access to quality education, healthcare, and other enabling support from both public and private sector stakeholders.

This is a significant challenge, one that has rarely occupied the centre of our national socio-economic or political discourse. It is, indeed, a pitiable state of affairs, but who gives a damn!

The Supreme Court had on March 19 questioned the claims of a high development rate and per capita income when in some states about 70 per cent of their population live below poverty line, and wondered whether distribution schemes of subsidised essential food grains really reached the poor in the country.

“There are states which utilise or project the development card, saying our per capita income is high, we have progressed so well, but we find that 70 per cent of their population are declared below poverty line (BPL)...How can these two factors go together? There is an inherent contradiction if 70 per cent people are BPL and still you claim a high per capita income,” Justice Surya Kant, heading a bench, observed.

The apex court wondered whether the subsidised ration system, meant to provide food security to the deserving poor, was merely a ploy by governments to garner popularity.

I have no reason to disagree with the Supreme Court on this count. Perhaps, no one will disagree. Ensuring that developmental funds are fully utilised and the benefits of affirmative measures and welfare schemes for the targeted groups has always been a challenge in our country. In fact, the idea of equitable distribution of national resources, opportunities, facilities, privileges and responsibilities among all in proportion to their population has few takers among those who matter in the system, despite the fact that the Constitution obligates us to check and defy any attempt to promote the evil design of denial and deprivation. The uneven implementation of affirmative measures meant for weaker sections of society is a classic example of how non-serious we are in empowering those who have left socially and educationally backward for centuries on account of their social identity, caste, to be more precise.

Chairman of the 16th Finance Commission Arvind Panagariya has said that India's aim to become a developed nation by 2047 is a “realisable ambition” for which the country’s per-capita income needs to grow at 7.3 per cent in dollar terms to $14,000 over the next 24 years. India’s per-capita income, in 2023-24-dollar terms, was about $2,570, which is quite low compared to South Korea and Taiwan.

“Today, our per capita income in dollars is about $2,500. To get to $14,000 in 24 years or by 2047-48, what growth rate do I need for per capita income...My per capita income from 2023-24 onward has to grow annually at 7.3 per cent,” said Panagariya.

He further said that as per the estimates by the United Nations, India’s population will grow 0.6 per cent by 2050. This would mean that to achieve that 7.3 per cent growth in per capita income, the GDP will have to grow at 7.9 per cent during the next 24 years.

What Panagariya said is perhaps food for thought for economists, development strategists and analysts but not for me who has been seeing so closely millions of people struggling to live with dignity even after so decades of Independence.

Let us not play football of alacrity with average household income growth. Let us get the actual data.

Our policy makers need to interact with the people travelling in general compartments of long-distance trains and find out from them how much they earn and the kind of education and healthcare they give to their children.

Then our policy maker should compare that with those who travel in sleeper classes, AC III, AC II and AC I compartments. It is up to them whether they would like to go a step ahead by drawing a comparison with those who travel by air.

Let us be honest, if not to ourselves, but certainly to the nation. We cannot play with the dreams of have-nots by imposing upon them the aura of ‘average figure’ which, in fact, is borrowed from the wallets of haves.

India’s gross domestic product (GDP) per capita was Rs. 2.16 lakh or about $2,500 at the end of March 2024. Now India wants to reach a GDP per capita of $20,000 by 2047.

Japan covered the distance in 15 years when its GDP per capita crossed $20,000 in 1987. South Korea crossed the $20,000 mark in 2006 by taking 23 years at a CAGR of 9.5 per cent. China’s 2023 GDP per capita was $12,614, which is over 2.7 times growth since 2010, at a CAGR of 11.8 per cent.

In comparison, India has grown at 7.8 per cent a year during the same period. At the current rate of about eight per cent India may reach a GDP per capita of $20,000 in 2050. If it improves the speed to the Asian average of 10.4 per cent, it may achieve the goal by 2044. The million-dollar question: Will we be able to have the kind of civic, health and education infrastructure China, Japan and South Korea have by 2047, that is, in the next 22 years from now?

Let the champions of ‘average figures’ answer this question. I keep my fingers crossed.

(The writer is a senior journalist, author and columnist. The views expressed are strictly his personal)