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Wednesday, December 5, 2007

World Economic Forum : Urbanizing Rural India is the road to development

"AS LONG AS all opportunities are concentrated in metropolises, you will not be able to stem this tide. It will be like King Canute," said Mani Shankar Aiyar, minister for Panchayati Raj and Youth Affairs and Sports of India today at the plenary session of 23rd India Economic Summit, of the World Economic Forum being organised in partnership with the Confederation of Indian Industry (CII).

This session, second of the day focused on one of India’s major challenge – the enormous resettlement from the countryside continuously overburdening big cities. More than one lakh people shift to Delhi every month looking for more job opportunities.

Talking about the scale of the problem, the minister said that while India’s economy has reached almost 10 per cent growth, the country has shrunk on the Human Development index, from 126th position to 128th. About 836 million Indians live on less than 20 rupees per day. A large number of them live on less than Rs nine per day. He said that though India was becoming prosperous, Indians were not and prosperity was affecting select Indians.

“India is not just the world’s largest democracy, but the most represented democracy,” stressed Aiyar. Elaborating this, he said that there were 250,000 elected governments in the country – in the form of local government institutions – comprising 2.2 million representatives of which half were women. Yet these people are not being involved in national economic and social policies. He added, "Elected self governments should be a source of delivery to people. We need to use them to secure entitlements for the poor. But they are still not within the policy perspective. Rural and urban are not separate. Both are connected. Until we see that, India will become prosperous and Indians will remain poor."

The minister, also a former bureaucrat lashed out at the bureaucracy saying that about 85 per cent money for any development was spent on the bureaucracy itself. The little money that reached the people was also not used in the best way. He suggested that smaller cities and urban settlements should come up with all facilities near the rural areas. And investment should be done in these areas also if we want to have a balance in non-agricultural rural activities such as biodiesel, handicrafts and food processing. He also urged businesses to locate their centres of operation in non-urban areas.

Examining ways in which this could be done, Anand G Mahindra, vice chairman and managing director, Mahindra & Mahindra, and a co chair of the India Economic Summit, said that, "Human beings like to live in cities. They have done so for thousands of years." He suggested that special economic zones could meet that need by forming what he called an ‘accidental’ way of spreading urbanization – and opportunities – to rural India. Mahindra also said that rural roads were very important not only to give access to schools and markets and create microbusinesses.

Ben Verwaayen, the chief executive, BT Group said that people came to India for a combination of unique talents: the language capability and the low cost. He added that people needed mobile devices in the villages also now to get empowered.
Mohamed Bin Ali Alabbar, chairman of Emaar pointed the need to use advance tecnology in construction and said that it was good for business also.
India Economic Summit was designed to develop insight and lead to action on India’s development, industry and global agendas in the context of this year's theme, Building Centres of Excellence.


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