Innovation Systems and Inequality: Indian Experience K J Joseph Centre for Development Studies, Thiruvananthapuram Lakhwinder Singh Punjabi University, Patiala Vinoj Abraham Centre for Development Studies, Thiruvananthapuram

Background Globalisation and Inequality Origin and Rise of Inequality Structuralist-Evolutionary Approach Development Strategy and Inequality

Co-evolution of NIS and Inequality in India Phase I-Growth With Equity-Reducing injustice Import Substitution and Public Sector Technology-FDI-IPR Regime and Labour Related Policies Asset Redistribution and Regulation of Monopoly Capital Policies Fiscal, Monetary, Pricing and Freight Rate Policies Food Procurement and Public Distribution System Finance Commission and Redistribution of Revenue

Co-evolution of NIS and Inequality in India Phase II: Market Oriented Growth for Equity Dismantling Controls and Policies Widespread distress in the Rural Economy Return back of Equitable Considerations National Rural Employment Guarantee Act

Trends and Patterns of Interpersonal Inequality in Consumption

Inequality of Wealth Across Households in India: to (Figures are in Rs.) Year Rural Average Assets Gini Coefficient Urban Average Assets Gini Coefficient Source: Subramanian and Jayaraj (2006).

Inter-Regional Disparities

History does matter-Colonial System of Exploitation and Regional Structure Three Phases First Phase: Decline in Inter-regional disparities till Mid-Sixties Second Phase: Rise in Inter-regional disparities- Green Revolution Period Third Phase- Liberalisation Period-Rising Inequality-Service Sector driven growth and disparities

Social Disparity Class Vs Social Categories Provided by the Constitution SCs, STs and OBCs Education, Capability Building and Opportunities The rate of educational dropouts is much higher for SCs, STs and OBCs. The rates of return on education for SCs/STs is also very low

Gender Discrimination Adverse Sex Ratio- 933 Discriminatory practices such female infanticide, female foeticide and practice of dowry Female literacy has improved but still gender gap is 0.7 Gender gap in wages is also very high

Access to Health Continuous improvements in Health Indicators, but gini coefficient shows stagnation in the post- liberalisation period Piling up of food stocks and persisting malnutrition 40 per cent children suffering from severe malnutrition 46 per cent children remained unvaccinated More than half the births take place without the benefit of a skilled attendent

Economic Development and Structural Heterogeneity Structural Transformation from agriculture to service sector Dependence of workforce for livelihood primarily remained on agriculture sector Employment opportunities in the informal sector Informal employment in the formal sector Decline in employment elasticity.

Inter-sectoral Productivity Differentials and their bearing on Inequality YearPrimarySecondar y TertiarySecondar y + Tertiary Kuznets’ index of inequality Secondar y + Tertiary/ Primary Source: Sivasubramonian (2000).

Regional Disparities in Competence Building Institutions and Production 1300 Science and Technology Institutions have been established 1400 R&D Units are functioning These are located in eight states-Viz. AP, Karnataka, Kerala, TM, Maharashtra, Delhi, UP and WB Public sector R&D is still more than 78 per cent Concentration of both public and private sector R&D expenditure in the Engineering and Technology.

Conclusions and Way Ahead Innovation System Remained Subservient to the National Priorities and Goals Production structure shown dynamism and inherently generated inequities Science and technology accentuated inequities Policy Instruments ensured to some extent the control over the inequitable regime but upper sections of society turned these instruments either in their favour or subverting them into non- functional Social movements and inclusive growth: Return of employment guarantee programme-Democratic Polity and Inclusive growth