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Mainstream, VOL LIII No 51 New Delhi December 12, 2015

Showcasing Challenges before the Kerala Economy in Post-Reform Period

Sunday 13 December 2015


by Renji George Amballoor

Kerala Economy and its Emerging Issues by V. Mathew Kurien and Raju John; Sahitya Pravarthaka Co-operative Society Limited, Kottayam; 2014; pp. 400; Rs 350.

Kerala Economy and its Emerging Issues is a comprehensively edited book on the dynamics of the Kerala economy in the post neo-classical era by Dr V Mathew Kurien and Raju John. The book provides the readers with in-depth insights on the emerging economic dynamics of Kerala. The editors have selected the articles in such a way as to endow the readers with a chance to kick-start the critical dissection the ‘Kerala Model’ of economic development.

The book has twentyone articles written by distinguished academic stakeholders of Kerala’s economy.

In the first article titled ‘Reforms and Kerala Model’, the author M.A. Oommen highlights the need for the Kerala model to address the issues of sustainability and equity on a war-footing to withstand the onslaught of the post-reform happenings.

Jayan Jose Thomas underscores the contri-butions of the service and construction sectors in fuelling economic prosperity in the State in his article titled ‘Kerala’s Development and Economic Growth: The Way Forward’.The author also lists out the various challenges like ageing population, widening income inequality gap, distress of outliner communities, diminishing public investment, stressed environment, etc. because the State’s growth strategy turned a blind eye towards its land and people.

‘Globalisation, Free Trade Agreements and Kerala’s Agrarian Economy’, an article by V. Mathew Kurien, provides a critical and elaborate theoretical perspective on globalisation. According to him, the agrarian distress, which is a spill-over of the post-1990’s free trade agreements and structural adjustment programmes, can be corrected by engaging in sustainable agriculture.

Jayan Jose Thomas in his paper, titled ‘The Roots of Kerala’s Industrial Backwardness’, describes the nature of industrialisation since the 1930s. The negative impact of power shortages, land and environmental issues on the industrial expansion of the State is also discussed.

In paper, titled ‘The Service Sector and Structural Transformation’, D. Shyjan illustrates how the tertiary sector in the post-reform period emerges as the major contributor to the NSDP and PCI in Kerala. The billion dollar question before the Kerala economy is how to translate the low-paid service sector assignments to high-paid ones.

Vijeesh Vijayan emphasises the fact that the employment generated by the Kerala’s software enclaves are mainly contractual in nature. In his paper ‘Software Industry in Kerala: A Study on the Structure of the Labour Market‘, the author is of the opinion that even though the software sector is a rising star in the State’s economy, the employment situation is very fluid.

In his paper ‘Growth of Banking in Kerala: Recent Trends and Patterns’, M.P. Philip explains the growth of the banking infrastructure in the post-liberation period and the consequent growth in banking-related activities.

A.D. Manikandan and Franco T. Francis suggest in their article, titled ‘Environment and Climate Changes a Case of Kerala’, sustainable development as the panacea for the emerging variations in the State’s climatic variables.

In the paper, titled ‘Technological Modernization and its Impact on Environment and Livelihood: A Study of the fishing Community in Kerala’, Jisha John and V. Mathew Kurien are of the opinion that the market and technology have impacted the livelihood of traditional fishermen and their marine ecology.

K.K. George and K.K. Krishnakumar are of the view that the State should immediately address public expenditure management, mobilisation of non-tax revenue, structural rigidities, over-emphasis on social sector development, fiscal prudence, etc. to consolidate the State’s finances in their paper ‘Trends in Kerala’s State Finances: A Study in the Backdrop of Economic Reforms in India’.

P.J. Philip—through his article ‘Kerala’s Fiscal Crisis: Structural Causes and Remedies’—recommends the broadening of the tax base and optimal taxation and public spending.

Bejoy K. Thomas is of the belief that the decline of poverty in Kerala, especially among the marginalised social groups, has been impressive in his paper ‘Monetary and Multidimensional Poverty in Kerala: A Review of Recent Evidence’.

In his paper, titled ‘Kerala Model of Health: From Success to Crisis’, B. Ekbal highlights the need for consolidating the gains in Kerala’s health care sector and addressing the emerging challenges.

In the paper, ‘Demographic Transition and Problem of Ageing in Kerala’, S. Sunitha observes that on an average every five working Keralites have one elderly person. Kerala is exhibiting a rising trend in the dependency ratio and index of ageing. She also recommends considering the aged as an asset.

Jose K. Naduthotty, in his paper, ‘The Status of Women in Kerala—A Reality Check’, laments the lower female work force participation, unfavou-rable child sex ratio, women property rights, etc.

According to Raju John in his paper on ‘Migration and Mobility’, consumption inequality is a by-product of migration. In turn it has increased caste-based inequalities but reduced gender-based ones.

V. Mathew Kurien and Raju John put together the need for Kerala to shift towards sustainable renewable energy sources in their article ‘Sustainable Energy for Kerala: An Overview’.

In the paper, titled ‘Industrial Infrastructure in Kerala: A Profile’, T.P. Thomas Kutty elaborates the institutional efforts of the State Government in creating the industrial infrastructures and rectifying the bottlenecks.

D. Dhanuraj and S. Madhu presents a SWOT analysis of the public transport system in Kerala in their article ‘An Evaluation of Public Transport System in Kerala’.

The construction boom witnessed in Kerala was region and sector-specific, thus creating an imbalance in the economy, according to Raju John in his paper, ‘Kerala’s Construction Boom: An Empirical Analysis of Sectoral and Regional Dimensions’.

The book has succeeded in showcasing the challenges faced by the Kerala economy in the post-reform period in a very lucid manner. Many of the contributing authors are young and their perspectives on various issues are refreshing and this needs to be appreciated. The attempt made by the editors to get the book published through Sahithya Pravarthaka Co-operative Society Limited is also a welcome step in the age of the market economy which needs replication.

However, the volume fails to be the one-stop book on the Kerala economy because there are many vital sub-sectors which need to be addressed. More authors could have been roped in to write on various topics instead of a few authors writing on more than one topic.

Dr Renji George Amballoor is an Associate Professor in Economics at the Government College of Arts, Science and Commerce, Quepem, Goa.