Column: Gujarats other calling card

Updated: Apr 19 2014, 08:26am hrs
India is at the half-way stage of Election 2014, and if opinion polls and turnout increases are to be believed, it looks increasingly likely that Narendra Modi will be our next Prime Minister. Why Modi evokes such strong reactions from the Congress and the Left (could it be that they know that their days as political elite are numbered with a challenger like Modi) is a subject for a later article. The advantage with forecasting what might happen under Modi is much easier than predicting the future of India if Rahul Gandhi was the leader or even LK Advani or Sushma Swaraj or Rajnath Singh. The reason is simplewith Modi, one has a performance record in Gujarat, spanning more than 12 years.

But, and this is the first of many objections, Gujarat is not India. It has only a six crore population; India is 20 times as large. So, what lessons can the

Gujarat experience provide I have always found this objection to Modi the most forced, and for a lack of a better word, the most stupid. Indeed, in no election, either in India or elsewhere, has stupidity sunk to such depths. One of the best political leaders in the last century, Bill Clinton, was governor of a state in the US, Arkansas, whose population was less than 3 million. Quite honestly, the objection to Modi as PM on such nonsensical grounds is not worth any discussion. So, my apologies.

There are many reasonable objections to a candidates quest for the highest honour. In the case of Modi, the biggest negative is the fact that a large communal riot took place under his watch, Godhra 2002. Enough has been written on this matter, by scholars, commentators, pundits, politicians and laypersons (including myself) that yet another discourse will have precious little value-add. There are other possible objections to Modi as PMhis leadership style borders on a personality cult, and that he has a tendency to be authoritarian. My own view, as a liberal, is that one should worry about such attributes, but I am rather shocked that my good intellectual friends did not raise such objections, for the last fifty years, or even utter a word about the personality cult around the Gandhis (Indira, Rajiv, Sonia, Rahul, and Priyanka). And regarding authoritarianism, and dictatorial leadership, we now have formal evidence, from Sanjay Barus book, The Accidental Prime Minister, that Sonia Gandhi has been just as dictatorial as Indira Gandhi, and perhaps even more so, since she did not (does not) have the constitutional authority to be authoritarian.

So, the political, personality objections to Modi as PM do not carry much weight. What is worthwhile discussing, and what does seem to carry weight with the new age Indian voter, is economic performance under different leaderships. In my previous article (Gujarats Inclusive Growth, April 12, goo.gl/cqadkM) I had discussed the pattern of growth in Gujarat since 1992, and how it had performed in the pre-Modi (1992-2001) and the post-Modi (2002-present) phases, relative to other comparable big states in India, and I had identified the seven similar states (SSS) Andhra Pradesh, Himachal Pradesh, Karnataka, Kerala, Rajasthan, Tamil Nadu and West Bengalas being comparable to Gujarat in 2001, the year Modi became Chief Minister of Gujarat. In the web space, there were some objections to the fact that I did not include Mizoram and Nagaland as comparators to Gujaratbut that was for a simple reason, data for comparison, especially NSS data, is not easily available for the small states.

Gujarat has performed very well on unemployment, agriculture, industrial and per capita GDP growth but how has it performed with respect to socio-economic indicators pertaining to health, education, inequality, etc That is the question being answered in this article. The results:

Inequality: Gujarat performs marginally better than the SSS. Real inequality in Gujarat, as measured by the Gini coefficient, increased by 2.3 percentage points to 28.6 between FY00 and FY12 (NSS data); in the SSS, real inequality increased by 3.27 percentage points to 32.4. So, both the level of inequality is less in Gujarat, and the increase has been proportionally lesser and smaller.

Education: The increase in school enrollment in comparator states is higher than the increase in Gujarat, but this result has largely to do with the fact that the variable being considered is subject to a ceiling value (100% enrollment). So, if a state starts with a higher initial level, its growth rate or increment, will, by definition, most likely be less (think about Keralagoing by increase, it is the worst-performing state). In FY12, female enrollment of the disadvantaged (SC, STs and Muslims) in Gujarat was 90.1%, compared to 86.7 for the comparator states. The corresponding levels in FY00 were 86.7% and 57.2%, respectively.

Access to water & sanitation: Very similar increases in both Gujarat and the SSS; however, Gujarat ahead by about 4 to 8 percentage points, with the highest lead in urban areas (97% in Gujarat versus 89% in the SSS).

Health: Female infant mortality in Gujarat was 60 deaths per 1,000 live births in 2001 and declined to 42 in 2011; for the SSS, the decline was slightly larger to 36 from 56.5 in 2001. But female life expectancy saw greater increase in Gujarat; from 64.6 years in 2001 to 71 years in 2008 versus a smaller increase (65.9 years to 70.8 years) for the comparator states. Note as well that in 2001, female life expectancy in Gujarat was 1.3 percentage points lower than the SSS; in 2008, it is marginally higher.

Sex ratio at birth (SRB): It is quite unlikely that a Chief Minister can have any influence over trends in the sex ratio, especially the sex ratio at birth. The only reason this statistics is being documented is because it was much talked about when Modi became the PM-nominee of the BJP in September 2013. That was the stick used to beat up the Gujarat model, but without presentation of evidence, of course! For whatever its worth, the SRB statistics suggest that the lot of the girl child has improved considerably in Gujarat between 2001 and 2011. The increase is of 72 points (from 844 to 916), second only to the increase observed in Himachal Pradesh (from 826 to 935). The national increase was considerably less at only 16 points (from 892 to 908). [Note that the biological ratio of girl births to 1,000 boy births is 950].

Several bits of data presented in this and in my earlier article reveal a consistent story, a story independent of the type of data (micro-household or state level) used. The reality is not data dependent, or dependent on the choice of states used to compare Gujarat with. One can make the absurd choice of choosing the best-performing state for each separate variable and then seeing where Gujarat stands, or make the equally absurd claim that Look Himachal is better on sex ratio so shouldnt one be talking of the HP model Alternatively, the research and policy community can accept the fact that the socio-economic performance of Gujarat has been the best, or certainly among the best, of all the states in India for the post-2000 time-period. Maybe the policies that Gujarat pursued in this time-period had something to do with its exceptional performance.

Surjit S Bhalla

The author is chairman, Oxus Investments, an emerging market

advisory firm, and a senior advisor to Zyfin, a leading financial information company. Twitter: @surjitbhalla.