Economic Divide in India

Published On:

The article explores the growing economic disparities between Indian states, highlighting regional imbalances in growth, investment, and policy implementation.

The Economic Advisory Council to the Prime Minister published data showing the per capita income of Indian states relative to the national average, revealing stark inequalities. States like Maharashtra, the largest contributor to the economy, also have significant poverty in regions such as Vidarbha. Richer states, primarily in the southern and western regions, have outperformed northern and eastern states in economic terms. This growing gap has led to demands for greater devolution of power from the central government. Additionally, private investment is concentrated in prosperous urban centers like Mumbai, Delhi, and Bengaluru due to better infrastructure and policies favoring profitability, while poorer states and regions lag behind. Coastal and resource-rich regions also attract more investment. Policies since the 1990s have shifted investment focus towards developed areas, leading to the neglect of poorer states. The public sector has taken a back seat, leaving weaker states with less investment and development. To address this imbalance, a shift in private and public investment strategies, along with more equitable governance, is necessary to reduce economic disparities between states.