(Part I of a two-part series)
There is increasing recognition that individual states in India have considerable leeway, especially if they operate in a constructive and cooperative mindset, to improve household welfare and progress to a higher level of development. In recent years, but especially since the Covid-19 pandemic, the Uttar Pradesh (UP) government, led by Yogi Adityanath, has taken several initiatives which have the potential to turn the state into a key diversified growth node for India.
UP is currently home to 240 million people (about 17% of India’s population) and is expected to have a GSDP of be INR 17.9 trillion (equivalent to USD 255 billion) in 2021. The state has an ambitious vision to raise its GSDP to USD 1 trillion by 2025, when India aims to become a USD 5 trillion economy. This represents a quantum leap in the UP’s contribution to 20% of India’s GDP from about 8.5% in 2020-21.
Achieving the ambitious target set to itself would require UP to usher in transformative changes in its economic, social, and political management. Even if UP gets fairly close to achieving its target, it would contribute greatly to India achieving its broader geo-economic and geo-strategic goals. The government has launched several initiatives to precisely realise this vision.
These initiatives are consistent with the Growth Diagnostics Framework (GDF), designed to increase outcome and income per household.
What is the Growth Diagnostics Framework?
The GDF is designed to aid thinking and focus on a project’s key areas, but it is not a blueprint to be followed as in the case for constructing a bridge or a building. Therefore, that’s not to suggest that the UP government has taken initiatives with GDF in mind, but that the initiatives happen to be consistent with GDF, in the context of UP’s conditions.
The five key elements of GDF – Physical Investment, Knowledge Application and Productivity, Productive Livelihoods, Skill-sets, and Cooperative Federalism – are interrelated. Investment initiatives have major implications on productive livelihoods, upskilling, and introduction of new knowledge and ideas.
In each area, it is essential to calibrate demand and supply factors, avoiding large imbalances between the two. For instance, initiatives which expand demand for healthcare or skills development without commensurate increases in the supply of these services create considerable distortions and adversely impact desired outcomes.
To avoid these adverse impacts and achieve national and individual progress, we also need to address a number of governmental failures. Prominent among them are upskilling – in terms of numerical skills, legal and regulatory skills, and economic literacy – and developing a technocratic rather than partisan political orientation of government institutions (including judiciary) and officials.
GDF suggests that besides relevant market and government failures, complementary markets must also be addressed, especially for large infrastructure projects. It envisages a coordinated use of market, state, not-for-profit sectors, social enterprises, and others to help the state (and country) progress towards desired outcomes.
GDF-based Initiatives – What Remains?
From raising entire cities (such as the Film City) and industrial hubs, to building airports and warehouses, the UP government has embarked on an ambitious journey towards prosperity. Its scope encompasses finance and entertainment, tourism and manufacturing, and defence and agriculture. The vision holds the promise of transforming the state. Then, what remains?
Administrative and HRD reforms. For too long, UP has struggled with core issues in its administrative structure and HRD. The fissures are deep enough to thwart any developmental effort. The UP government must lay great emphasis on bringing about administrative and HRD reforms to the state. For this, it must leverage the Centre’s Karmayogi Scheme to enhance the competency and skill sets across public sector organizations, political parties and officials, and the judiciary.
The INR 5.1 billion scheme is run on a digital platform (iGot Karmayogi) which also aims to serve as the launchpad for the National Programme for Civil Services Capacity Building (NPCSCB). The Karmayogi Scheme plans to cover 46 lakh central government employees, at all levels, over a five-year period. It is designed to support a transition from “rules-based to roles-based” Human Resource Management (HRM) so that work is allocated through matching an official’s competencies to the requirements of the post. These reforms are vital if the UP government is to achieve its ambitions.
Armed with an efficient administration and trained personnel, the UP government is highly likely to see its ambition succeed – especially the 13 initiatives which promise to transform the state. But what are they?
(Read Part II of the two-part series here)
(A version of this article was first published here on MyIndMakers.)
Dr Mukul Asher
Dr Mukul Asher retired as Professorial Fellow at Lee Kuan Yew School of Public Policy, National University of Singapore, in June 2018. He specialises in public financial management, pension reforms, and application of economic reasoning to public policy, especially in India.
The views and opinions expressed in the above article belong to the author(s) and do not necessarily represent the official opinion, policy or position of Lokmaanya.