Context: In India, it is often compared that States in South are more developed than North.

What are the main reasons for regional disparities?

• The spatial variations in disparities results from a mix of underlying historical factors, different demographics, geographic conditions, and policy decisions such as:
  • Colonial Legacy: During British rule some provinces such as Bombay, Madras got more attention for development. 
    • Besides, coastal states received extra advantage as they could trade with other countries.
    • As a result these regions got an edge.
  • High GDP growth in Southern States: In the past decade, the GDP growth rate in southern states ranged between 5-6%, whereas most northern states remained at 2-3%.
    • According to RBI data, in terms of GDP per capita, Goa is 9.6 times more prosperous than Bihar.
  • Contribution by Labour: Labor mobilization patterns from states like Bihar contributed to development of few states (gujarat, maharashtra)
  • Sectoral differences: In manufacturing, the southern states continue to outperform their northern counterparts by a difference of 2%. 

Regional Disparities Trends

•  Contribution to the State’s GDP by Districts:
  • Maharashtra: Districts within a certain state vary in terms of their contribution to the state’s GDP. 
    • For Example: Maharashtra, four districts—Mumbai, Thane, Pune, and Nashik— collectively account for over 50% of the state’s GSDP
  • Uttar Pradesh: In Uttar Pradesh, Gautam Buddha Nagar holds the highest share, representing 8.91% of the state’s GSDP, while the remaining 65 districts collectively contribute less than 4%.
• Export competitiveness:  Among the 680 exporting districts, the top hundred districts contribute approximately 87% of India’s total exports.
• Access to water and functional tap connections: Of 680 districts, all households in 105 districts have functional tap water connections. 
  • On the other hand, 339 districts have less than 50% of households having functional tap water supply.
• Southern States: Among the major southern states, Karnataka registered a remarkable 7.07% growth rate between 2010 and 2020 and continues to grow promptly while the average growth rate of southern states falls around 6.31%.

Ways to Reduce Regional Disparities 

• Focus on Education and Skills: Investments in quality education and skilling can go a long way in improving productivity outcomes and creating a pool of skilled workers.
• Tapping Demographic Dividend: India is at its prime to engage the youth to reap maximum benefits from the demographic dividend before the population ages.

Conclusion:

As India moves forward in the age of competitive federalism, states have a pivotal role to play as drivers of development, and to facilitate their active participation. National policies should take cognisance of the regional disparities and address development in all its dimensions across the country.

Must Read: Are Southern States of India Being Punished for their Success?