A Mistaken Model? The consequences of Gujarat's brand of development
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Photography by Liv Dowling

Over 36 days in April and May the world's largest democracy went to the polls. Elections are about many things, but we can say with some confidence that the results partially hinged on the success of the Bharatiya Janata Party (BJP) in convincing voters that it had a plan for India's economic future.

After years of stagnant growth—beginning with the 2009 global crash and ending with the 2013 decline of the rupee to nearly 70 on the dollar—the economy has been a key issue on the minds of Indian voters.

Narendra Modi, the leader of the BJP and now former Chief Minister of the state of Gujarat, has built his political career on the idea that his state is a replicable model of economic development for India. Of course, it could only be replicated with the correct party in power. Reinforced by a formidable public relations machine and repeated by the national media, the "Gujarat Model" of development became either a key justification or indictment of Modi's aspirations to power.

Proponents of the model point to Gujarat's above-average growth rate, its ability to attract foreign direct investment (FDI), and the highly publicized preference of top Indian CEOs to see Modi in power1. Statistics were paired with Modi's personal brand of decisive, virile, and entrepreneurial leadership, qualities seen as entirely lacking in the Congress Party-led government.

One consequence of the public perception of Gujarat as a viable model was evident during the course of the national election: Development was equated with industrialization and economic growth rather than equity and human development.

The question as to whether Gujarat is a "model" (in the sense that it is something to be emulated) or whether it even represents a coherent economic ideology has been debated endlessly, including by two of India's leading economists2. My own view—which comes after ten months of living in Gujarat's largest city and with the unavoidable biases of an outsider—is that Gujarat is a model. A model that should not be replicated across India.

I say this for two reasons. The first reason comes from personal observation, the second from my understanding of the model's ongoing failures and potential for even greater negative implications in the years ahead.

I liked Ahmedabad, Gujarat when I arrived in September 2013. The city is rapidly modernizing. Elegant multi-story condominiums slice into the sky in the western part of the city. The power supply never fails. There seems to be less corruption: the auto-rickshaws rarely try to cheat passengers and the police regularly ticket traffic violators and search out drunk-drivers. I felt safe; I was comfortable leaving a late-night party alone, something I would have never tried when I lived in Delhi.

Photography by Liv Dowling

But it was not as different as I had heard or had hoped. The roads need repair in many parts of the city. Trash still lines the streets. The children of poor residents run barefoot. It is the most segregated city I have lived in in India. The azan and the bells of the mandir never interlaced as they had in Delhi.

Going into the field revealed the urban-rural divide. In the eastern districts of Dahod and Panchmahal, the roads are pocked with holes, unlike the glossy ribbon of highways around Ahmedabad. Tribal women eke out an income from small plots of land, their male relatives having migrated to the cities for work. Muslim families still live in colonies with no running water or electricity, unable to return to the homes they lost in the communal violence of 2002. Similarly, in the coastal districts of Bhavnagar and Amreli, it was clear many had yet to feel the benefits of development.

Perhaps I was not witnessing the Gujarat Model, but the Ahmedabad Model. Or more accurately, the divide between the Golden Corridor (comprising the relatively thriving cities of Gandhinagar, Ahmedabad, Vadodara, and Surat) and the rest of Gujarat.

Personal observations are, of course, limited. But from both the ideological Left and Right, the Gujarat model is deeply flawed.

From the left, critics like economist Jean Drèze have noted, "Gujarat is doing a little better than the all-India average in many respects, but there is nothing that justifies it being called a 'model.'" 3 Local NGOs and activists have long argued Gujarat's economic development has not led to greater human development. Take, for example, the status of women. Gujarat has traditionally been considered less gender discriminatory than other Indian states. Yet the literacy rate among rural women is 56%, one of the lowest percentages in India 4. Gujarat is the third worst performer on girls' education, just above Orissa and Rajasthan, with 26.5% of girls out of school. (This number rises to a staggering 44% for Muslim girls) 5. Gujarat also has a sex ratio and child sex ratio (children aged 0-6) far below the national average (which is itself dismal), meaning thousands of girls are lost to sex selective abortion, infanticide, or discriminatory childcare in Gujarat.

The picture is hardly brighter when it comes to food security, water and sanitation, environmental degradation, and education. Forty-three percent of children under five years are malnourished in Gujarat, higher than the national average, possibly stemming from poor management of nutrition schemes and extremely low wage rates within the state 6. Gujarat ranks 10th in toilet use with 65% of households engaging in open defecation, leading to consequent high levels of diarrhea and jaundice, among other diseases 7. Regarding education, the director of one women's rights organization working in Gujarat notes that the government has consistently undermined traditional ashramshala schools in favor of commercial schools 8. Ashramshalas typically provide a cheaper option for poor families while still offering a good education. The withdrawal of government funding has hit these institutions hard. The result is poor families with little choice other than to send their children to substandard or resource-stretched public schools or simply not send them at all.

From the right, the Gujarat model takes neo-liberal principles to their extreme, relying on rampant deregulation and public indebtedness—a formula that might sound familiar to Americans in 2009. Traditional areas of state investment, such as ports, roads, rail, and power have been passed over to corporates to the extent that "nowhere else in the country has this abdication of responsibility been so total." 9 To sustain its reputation as a business-friendly state, the Gujarat government offers tax deductions, low interest rates, enormous subsidies, and land at throwaway prices to corporate investors.10 This has helped make Gujarat the most indebted state in India at 29,220 INR (487 USD) per capita.11 Finally, despite well-publicized investment initiatives like the "Vibrant Gujarat" summits, Gujarat only ranks 6th in FDI, accounting for 2.38% of total foreign investment inflows to India. This places Gujarat far behind Maharashtra, which accounts for 39.4% of foreign investment.12

Photography by Liv Dowling

Yet, the idea of the Gujarat model remains largely unsullied in the minds of the public, particularly among the middle and upper classes. As someone working in the NGO sector, I confess I am less interested in who is right or wrong about the Gujarat model than how the model is perceived. Perceptions have real world implications for ordinary citizens, particularly vulnerable citizens and the people and organizations that support them.

One consequence of the public perception of Gujarat as a viable model was evident during the course of the national election: Development was equated with industrialization and economic growth rather than equity and human development. No matter the results of the election, this will be an ongoing debate in India, and indeed every developing country, in the years ahead.13

The second consequence affects social justice activism in the state. When development means privatization and corporatization, it is more likely certain NGOs and activists will run afoul of the state government. The issue of funding is of particular importance here. As Gujarat is increasingly viewed as a prosperous state in both domestic and international spheres, funding is withdrawn, which negatively impacts social justice organizations. In essence, as the necessity of social activists' effectiveness goes up, the tools and available resources they have to do their work goes down.

"There is this feeling that Gujarat has grown, that Gujarat is prosperous," says Prasad Chacko, director of the Human Development and Research Centre in Ahmedabad. "[International donor agencies] were waiting for an excuse to reduce their areas of operation. So the moment Gujarat started showing high GDPs, they would go out. There are enough educated people in those agencies to know that GDP figures are no indication of [human development]."

The global financial downturn in 2009 decreased foreign aid in almost all developing countries.14 In particular, middle-income countries (MICs) like India have been singled out as no longer in need of assistance as they can afford to focus on poverty themselves.15 The problem is that the majority of poor people still live in MICs and India itself accounts for a staggering 33% of the world's poor 16.

"Gujarat has been declared an advanced state," says Nafisa Barot of Utthan, a rural livelihoods NGO working in four districts of Gujarat. "Modi makes it a point to say that Gujarat does not require [foreign aid] because he doesn't want NGOs to get that kind of money."

This latter view attests to the complicated relationship between the Gujarat government and a several rights-based NGOs in the state. Where once the state cautiously collaborated with these organizations, they now face reprisals for confronting the state on economic development issues and human right abuses dating back to the 2002 communal pogrom and encounter killings of RTI activists. These reprisals range from non-consultation and indifference to active surveillance and intimidation.

But the relationship between social justice non-profits and the Gujarat government is not unique. Similar occurrences are common in other states and at the central government level. Many NGOs have also been able to work proactively with the Modi government, provided they do not become too involved in contentious issues, such as caste inclusion or land rights.

What is different about the Gujarat government is its mentality, says one NGO director. "In some states you feel there is far more openness to work with NGOs. The unique thing in Gujarat is that the state is genuinely not interested in addressing poor people's needs. It's like if you hide them, you don't have to acknowledge there is poverty…That is the hardest and toughest part for us civil society organizations: that even if there is an acknowledgement that there is poverty, the entire attitude of the state government is that 'we've got it right. It's your habit to just poke holes in everything and we've got it all right.' If there is an acknowledgement that there is a problem, then at least you can work towards a solution."

In the end, the power of state governments to curtail the activities of social justice NGOs is somewhat limited. However, now that the BJP has obtained power in New Delhi, we may see changes in how organizations are dealt with, including cutting off foreign contributions.

These are some the real consequences of the Gujarat model. The results of the election show the more leftist parties, such as the Congress Party, were unable to offer a viable political alternative. Likewise, it cannot be argued that Congress has been a perfect administrator of its own states and areas of control. Yet, in Modi and in the Gujarat model there is a certain contempt of criticism and a failure to engage in open dialogue that should be concerning to a democratic society.

After years of anemic growth and widespread corruption, the Indian voter is justified in his or her desire for change. The lure of economic development and modernization promised by the Gujarat model certainly fits the bill. But if India does not employ an economic model that can seriously tackle rising inequality and promote inclusive development, its growth will be evident on spreadsheets but not in the communities where women and men fight a daily struggle against poverty and exclusion. Frankly, they deserve a better model.

Liv Dowling has a BA in Political Science and International Studies from Yale University. She has spent the last three years conducting political and development research in India and Thailand. Most recently, Liv completed her AIF Clinton Fellowship with Utthan, a grassroots women's empowerment and rural livelihoods NGO based in Ahmedabad, Gujarat, where she piloted a training for NGO specialists on inclusive approaches in water-based livelihoods.

  • 1 - "Poll shows top CEOs prefer Modi to Rahul as PM: report," NDTV Profit, September 6, 2013, http://profit.ndtv.com/news/politics/article-poll-shows-top-ceos-prefer-modi-to-rahul-as-pm-report-326803
  • 2 - Gardiner Harris, "Rival Economists in Public Battle Over Cure for India's Poverty," New York Times, April 21, 2013, http://www.nytimes.com/2013/08/22/world/asia/rival-economists-in-public-battle-over-cure-for-indias-poverty.html?pagewanted=all
  • 3 - Jean Drèze, "The Gujarat Muddle," The Hindu, April 11, 2014, http://www.thehindu.com/opinion/op-ed/the-gujarat-muddle/article5896998.ece
  • 4 - Joseph Tharamangalam, "Gujarat: A seriously flawed 'model' of development and democracy, blatantly tilted towards interests of a small minority," Counterview.org, April 8, 2014, http://counterview.org/2014/04/08/gujarat-a-seriously-flawed-model-of-development-and-democracy-blatantly-tilted-towards-interests-of-a-small-minority/
  • 5 - Ibid.
  • 6 - Hemantkumar Shah, "Much against the claim that Gujarat is India's "growth engine", facts suggest this was not so in the last one decade," Counterview.org, April 11, 2014, http://counterview.org/2014/04/11/much-against-the-claim-that-gujarat-is-indias-growth-engine-facts-suggest-this-was-not-so-in-the-last-one-decade/
  • 7 - Hensman, Rohini. "The Gujarat Model of Development: What would it do to the Indian Economy?" Economic & Political Weekly Vol. XLIX, No. 11 (March 15, 2014). http://www.epw.in/web-exclusives/gujarat-model-development.html
  • 8 - Name withheld. Interview by author. Ahmedabad, Gujarat, May 6, 2014.
  • 9 - Shipra Nigam, "Gujarat and the Illusion of Development: Shipra Nigam," Kafila, May 23, 2013, http://kafila.org/2013/05/23/gujarat-and-the-illusion-of-development-shipra-nigam/.
  • 10 - Christophe Jaffrelot, "No model state," The Indian Express, September 6, 2013, http://archive.indianexpress.com/news/no-model-state/1165249/0.
  • 11 - Prachi Salve, "Fact Check: Does Gujarat Have Highest Per-Capita Debt?" India Spend, October 19, 2013, http://www.indiaspend.com/fact-check/fact-check-does-gujarat-have-highest-per-capita-debt-38768.
  • 12 - Hensman, Rohini. "The Gujarat Model of Development: What would it do to the Indian Economy?" Economic & Political Weekly Vol. XLIX, No. 11 (March 15, 2014). http://www.epw.in/web-exclusives/gujarat-model-development.html.
  • 13 - Phillip Inman, "World Bank says growth alone can't end poverty," The Guardian, April 10, 2014, http://www.theguardian.com/business/2014/apr/10/world-bank-poverty-growth?INTCMP=ILCNETTXT3487.
  • 14 - "Development: Aid to developing countries falls because of global recession," OECD, April 4, 2014 http://www.oecd.org/newsroom/developmentaidtodevelopingcountriesfallsbecauseofglobalrecession.htm
  • 15 - Andy Sumner and Amanda Glassman, "Aid cuts to middle-income countries worsen global poverty and ill-health," The Guardian: Poverty Matters Blog, January 2, 2012, http://www.theguardian.com/global-development/poverty-matters/2012/jan/02/aid-cuts-middle-income-countries.
  • 16 - "Development: Aid to developing countries falls because of global recession," OECD, April 4, 2014 http://www.oecd.org/newsroom/developmentaidtodevelopingcountriesfallsbecauseofglobalrecession.htm