matru

1
INDIAPolicies to Reduce Poverty and Accelerate
Sustainable Development through Globalization
2
Steady Progress since Independence

• Decline of Poverty since the mid-1970s
• 5.8 per year growth trend since 1980
• End of the 1980s development strategy proved
  unsustainable

3
Quick Recovery from1991 Crisis

• Stabilization
• Reforms
• 3 years of 7.7 per year average growth

4
Sluggish Poverty Reduction in Recent Years

• Poverty reduction fell by 1993-94
• Improvement limited in rural areas
• Poor states lag poverty reduction

5
Despite Achievements, Significant Challenges
Ahead

• Public spending focused on subsidies
• Subsidies crowd-out public investment
• State issues with infrastructure, human
  development and governance

6
Potential Problems in Accelerating Poverty
Reduction, Sustaining Growth
7
India's Future Growth and Poverty Reduction

• Deterioration of infrastructure
• Slower pace of reforms and the resulting
  uncertainty for investors
• Lack of agricultural deregulation
• Still-low indicators of human development
• Governance and institutional issues

8
Large Deficits, related to Large Explicit and
Implicit Subsidies

• Large and rising fiscal deficit
• Large public sector debt
• Tax system
• Large civil service

9
Comfortable BOP but Constraining Domestic Policies

• Balance of payments comfortable
• Lack of further tariff reform
• High infrastructure and transaction costs
• Domestic regulations

10
Financial SystemRemains a Concern

• Credit availability to private sector

11
Legal and Environmental Issues

• Enforcement of property rights and contracts
• Justice delayed is justice denied
• Environmental and resource degradation

12
A Second Wave of Reforms to Reduce Poverty Faster
13
Reforms

• Cuts in the explicit and implicit subsidies
  together with privatization in power

14
Reforms

• Realignment of Central and State Governments

15
Reforms

• More spending on health and education

16
Reforms

• Improved Governance

17
Reforms

• Completion of the deregulation of goods and
  factor markets

18
Reforms

• Financial System

19
Reforms

• Improved infrastructure provision

20
CONCLUSION