In the First and Second Five Year Plans, the goals of economic development were identified as under:
i. A higher rate of growth of GDP;
ii. Enlargement of employment potential leading to full employment;
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iii. Removal of poverty;
iv. Promotion of equity in distribution of income; and
v. Removal of regional disparity between the rich and the poor states.
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On the basis of these goals, economic reforms can be assessed as under:
(1) It is argued by the proponents of economic growth that the reform process accelerates the economic growth. The annual average growth rate of GDP during the decade of 1990s was about 6 per cent against the average GDP growth rate of 5.5 per cent during the pre-reform period (between 1980-81 and 1990-91). Presently, the economy is all set to grow at a still higher rate of 7.0 per cent which may go on to become and even exceed 8.0 per cent. Thus, the reform process to a certain extent has been successful in obtaining high GDP growth rate.
(2) The growth rate of employment declined from 2.39 per cent per annum during 1983 and 1990-91 to a mere 1.0 percent per annum during 1990-91 to 1999-2000. The growth rate of employment in organised sector was merely 0.6 per cent. This was just one-third of the
growth of employment witnessed in the pre-reform period. The growth rate of unorganised sector which was of the order of 2.41 per cent during the pre-reform period (1983 to 1990-91), also declined to 1.1 per cent in the post-reform period. Thus, decline in the employment indicates the state of jobless growth.
(3) Poverty ratio declined from 36 per cent to 26.1 per cent in 1999-2000. However, the rate of poverty reduction which was around 3.1 per cent per annum during the period 1983-1991 reversed to 1 per cent in the 1990s, i.e., between 1991 and 1997. Thus, an inverse relationship is observed between GDP growth and poverty reduction. This reflects that the benefits of growth do not reach to the poor.
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(4) During the pre-reform period, of the total mandays lost, 53.8 per cent were accounted for by the strikes and remaining 46.2 per cent were due to the lockouts. However, in the post-reform period, i.e., 1991-2000, the proportion of the mandays lost due to strikes came down to 39.8 per cent and share of lockouts increased to 60.2 per cent.
Thus, in the post-reform period, proportion of mandays lost due to lockouts was much higher in the post-reform period than in the pre-reform period. This shows that due to privatisation and policy of reforms, the employers’ militancy has increased and the workers have been put in much vulnerable position.
(5) The quality of employment has also deteriorated in the post-reform period. The share of casual labour in the total workforce which was 32 per cent in 1993- 94 rose to 33.2 per cent in 1999-2000. All these facts indicate that labour has been adversely affected by the economic reforms.
(6) The agriculture sector has been neglected in the reform period. The growth rate of agriculture declined from 3.7 per cent per annum during the pre-reform period to only 2.9 in the post-reform period.
(7) Economic reforms have aggravated regional disparities by favouring the forward states. The ratio of maximum and minimum Net State Domestic Product (NSDP) has increased from 2.7 in 1990-91 to 4.6 in 2000-01. Thus, regional disparities in terms of growth of NSDP – both total and per capita – has widened further.