India should shift its focus from economic growth to improving societal well-being through inclusive growth, said Niti Aayog member V.K. Saraswat.
Delivering a lecture on ‘Inclusive Growth- A Myth or Reality’ at the Indian School of Business here on Tuesday, Dr. Saraswat said despite a growth rate of seven % for two years, there was no connection between the growth and development. “Development is not just Gross Domestic Product. The government should focus on socio-economic development rather than economic development alone,” he said.
Inclusive development creates opportunities for all segments of the society in health, education, skill development, jobs, reducing poverty, entrepreneurship on the principle of based on equality and focuses on outcomes and processes involving people’s participation and benefit-sharing, he said.
Speaking as part of Dean’s Speaker Series at the ISB, Dr. Saraswat said the government’s vision was to attain inclusive growth. If India continued its present growth, it could be a $5.6 trillion economy in 20 years. But to translate it into inclusive development, the government and the Niti Aayog have identified 10 vectors of growth such as education, healthcare, life expectancy, basic services, agriculture and infrastructure. In other words, the thrust should be on human capital development as well as the institution development.
At present, India lagged in inclusive growth and it was time to go for multi-dimensional framework, consultation and engagement for understanding what the citizens needed, and adopt integrated outcome-based performance models. For this, the government launched programmes like Make in India, Housing for All, promoting competitive federalism through ranking the States, smart city programme, skill India, financial inclusion, digitisation, roads and highways, renewable energy, etc.
On the need to promote sustainable development, he said the challenges of the current economic system would create green economy opportunities of promoting public transport and alternative fuels.
He said informal economy was excluded from the growth talk and only 25% of the countries mentioned it in their ambitious plans. In India, 45% of its GDP came from the unorganised sector.
Inclusive growth is high on government’s agenda and 1.1 billion Aadhaar numbers were for target support. The GST, FDI de-regulation, bankruptcy laws, inflation targeting were some of the structural reforms brought by the government to boost growth.
Though the government created ₹10,000 crore start-up fund, the propensity to take risk was poor in India, particularly in the MSME sector.
Sharing the concern to improve the quality of human capital through skill development, he said that there should be parity between academic and vocational education. Both the AICTE and MCHRD have taken steps to revamp higher education segment, R&D and innovation, he said.