ABSTRACT
This chapter presents the overall picture with respect to trends in growth, employment, poverty and inequality within India and highlights regional variations in the same. Trends in aggregate output and employment in the pre- and post-liberalization periods are analysed with respect to the country as a whole as well as variations across states. The extent of structural transformation since independence has been impressive to say the least with substantial fall in the share of agriculture in aggregate output and a rise in the share of services, especially in the post-liberalization period. However, the experience with respect to industry, especially manufacturing, has been somewhat disquieting as its share in total output has stagnated while its share in total employment has even fallen in recent times. Several features of the current Indian employment scenario are a cause for concern; these include the relatively low share of employment in manufacturing, preponderance of informal sector employment, rising share of open unemployment and disheartened workers among the youth, low and falling labour force participation rates among women, to name a few. At the same time, high levels of multidimensional poverty and sharply rising inequality, especially in the post-liberalization period, show that by itself growth will not take care of these critical aspects of development and active state intervention remains important as ever. On a positive note, India has undergone a massive digital transformation over the recent decades which provides unprecedented precision to policymakers in targeting transfer payments to beneficiaries. Transformative changes such as the GST are working wonders in ushering in greater degree of formalization across the economic landscape. All such changes empower the state in manifold ways and further strengthen its capacity to deliver some of the world’s largest social safety net programmes in poverty and health. These will play a crucial role in the days ahead in reducing social and spatial disparities for a more inclusive pattern of growth.
