India: Accelerating Growth, Creating Well-paid Jobs for the Masses

Authors

Abstract

Issue: Sep-Oct 2020

Transformation of Indian economy to a modern, urban and industrial one at a fast pace requires the creation of a policy environment that would accelerate the growth of medium and large enterprises, especially in labour intensive sectors such as apparel, footwear, furniture and numerous light manufactures.  Key policy reforms required for the emergence of these enterprises include opening the economy to foreign trade and investment wider, flexible labour markets, availability of land to businesses at reasonable prices and low rental housing for migrant workers taking up jobs in the enterprises. Considering the complexity of undertaking multiple reforms involving both Centre and States, an option may be to create Autonomous Employment Zones, spread over areas of 500 square kilometres or more with full autonomy to implement their own labour and land laws, as is the case in Shenzhen in China.  The zones can also be designed such that imports and exports can move rapidly into and out of it. These zones may help bring many multinationals currently looking for locations other than China.  The paper also lists a number of reforms in education, privatization, food procurement and public distribution system, power sector, civil service, tax administration, and fiscal and monetary policies.  I discuss these reforms in detail in my recent book, India Unlimited.  JEL: F1, F4, J2, R3

Keywords:

Economic Reforms, Growth Acceleration, Openness, Transformation

Author Bio

Arvind Panagariya, Columbia University

Arvind Panagariya is a Professor of Economics in the School of International and Public Affairs at Columbia University, New York City.

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Published

2020-09-03