In a pivotal election, the people of Karnataka have voted out the BJP government that made communal hate its business. In electing the Congress, the people also appealed for economic relief in their lives. The Congress won its largest vote shares in districts that have felt the greatest economic pain. The new government has promised to honour its five guarantees to financially assist women and the educated unemployed, provide free grain for poor families, and (as is now obligatory) supply free electricity. But this is not nearly enough.
The government’s guarantees are handouts—they are, at best, economic band-aids. Successive Karnataka (and other Indian) governments have largely ignored the essential prerequisites of development: human capital and jobs; and they have allowed the steady decay of the justice system and the environment. Remedying these long-standing deficiencies is necessary so that people can stand on their feet and no longer require handouts.
Unfortunately, India’s prevailing economic development ideology—an ideology pioneered in Karnataka—advocates technological leapfrogging to sell a narrative of progress and handouts to keep the vulnerable beholden. If the Congress government in Karnataka sticks unthinkingly to this ideology, democracy will once again betray the voters. An authoritarian communalism will gain new strength.
One astute commentator has warned that Karnataka’s people have made a “conditional contract” with the Congress. The Congress’ seat majority came at the expense of the implosion of the Janata Dal (Secular). The BJP remains strong, having won more votes in 2023 than in the 2018 election. The stakes are high. Contrary to the popular notion that southern states are clearly superior to northern states, Karnataka’s economic and political indicators closely track Indian averages, as if India’s progressive and destructive forces are locked in battle in the State. What happens next in Karnataka will tell us which force is winning.
Commentators dubbed Bengaluru as “India’s Silicon Valley” in the second half of the 1980s, soon after Texas Instruments established a software facility in the city. India’s inexpensive technological talent was put to work, and the future held endless possibilities.
The big breakthrough came in March 1999 when Infosys Technologies became the first Indian-registered company to trade on the NASDAQ stock exchange. In January 2000, U.S. Treasury Secretary Lawrence Summers visited the plush Infosys headquarters in Bengaluru. And as Jawaharlal Nehru had done for the Bhakra Nangal dam in July 1954, nearly half-a-century later Summers described the glamorous Infosys campus as a “temple of modern India”.
The man who best articulated the technological leapfrogging narrative was Nandan Nilekani, one of the seven co-founders of Infosys. In February 2004, displaying the company’s video teleconferencing capacity across multiple time zones, Nilekani said to the visiting New York Times journalist Thomas Friedman, “Tom, the playing field is being levelled.” The awestruck Friedman converted that phrase into “The World is Flat”, making that the title of his best-selling book. Friedman’s message was that bright young Indians were poised to take the jobs of techies, radiologists, wire-service reporters, and even executive assistants in advanced nations.
By 2010, Nilekani had turned his gaze to India’s development problems. He invented the Aadhaarcard, which would give a unique identity number to every Indian. In September that year, 10 Adivasis in the Tembli hamlet in Maharashtra received their identification cards from Prime Minister Manmohan Singh and Congress chief Sonia Gandhi in the presence of Nilekani and other dignitaries. The poor would be the greatest beneficiaries of this innovation, Singh said.
Through the now nearly four decades of the leapfrogging promise, India has struggled to advance education and health delivery, a struggle all-too-evident in Karnataka. A true welfare system gives the highest priority to accelerated human development because that gives people more productive opportunities, a greater sense of well-being, and, therefore, reduces their dependence on handouts as band-aids. But politicians and elites cynically promote band-aids as “welfarism”.
To be sure, there has been progress. But the Indian voter’s and the country’s economic future are being savaged by the tyranny of low expectations. In 2020, 27 per cent of women in Karnataka could not pass a simple literacy test. This ratio will diminish over time as the share of a younger population with basic literacy skills increases.
But aside from these low-hanging fruits, the education system is failing the people. The quality of education has stayed stubbornly poor. Between 2006 and 2016, only between 40 and 45 per cent of Class III students in rural Karnataka could read a Class I text; that ratio was at a low 40 per cent in 2018, just before COVID, and fell to 24 per cent in 2020. Only about 20 per cent of children in Class V could do division sums in the years before COVID, and only 12 per cent in 2020. In these metrics, Karnataka has consistently performed below the national average.
For many students, the learning gaps are never filled, and they fall further behind their grade level. Unable to cope, about 25 per cent of Karnataka’s children aged between 15 and 17 stop attending school, which is a little under the Indian average. The vast majority of the rest go unprepared to subpar colleges and thence to the wilderness of unemployment and dead-end jobs.
- The glamour of information technologies often blinds us to the fact that about 45 per cent of India’s and Karnataka’s workforce is deployed in agriculture, up from about 40 per cent just before COVID.
- Outside of agriculture, the most important job-creating activity is construction, where workers are idle on days they do not get work and when they do work, they toil long hours on pitiful wages.
- Jobs created by the information-technology and allied sectors are so few that they do not show up as a separate category in the official employment data.
- Wrapped up in bureaucratic ineptitude, corruption, and crime, the justice and water systems in Karnataka, as elsewhere in the country, are slow-moving train wrecks.
In health, global improvements in medical technology and pharmaceuticals have been a continuous source of low-hanging fruit, which India’s public health system has absorbed and successfully deployed. But once past that easier task, the gains accrue at a glacial pace. According to the National Family Health Survey, the share of stunted children in Karnataka (those who had low heights for their age) remained virtually unchanged at about 35 per cent between 2015-2016 and 2019-2020. Those numbers almost exactly match the Indian averages. Multiple studies have established that stunted children suffer long-term handicaps in work and life.
The incidence of anaemia among women between 15 and 49 became worse, up in Karnataka from 45 per cent in 2015-2016 to 48 per cent in 2019-2020, about ten percentage points lower than the Indian average in both years. The spread of non-communicable diseases such as diabetes is creating new challenges for the healthcare system and extraordinary out-of-pocket expenses for patients.
The five guarantees from the Congress do little to address such human development failures. They do even less to close the yawning jobs deficit.
The glamour of information technologies often blinds us to the fact that about 45 per cent of India’s and Karnataka’s workforce is deployed in agriculture, up from about 40 per cent just before COVID. People are crowding into agriculture just when farms are becoming ever smaller. In 1970-1971, 30 per cent of the operational holdings in Karnataka were less than one hectare (they were marginal holdings, in official terminology). By 2015-2016, the year of the last agricultural census, 54 per cent of the holdings were marginal. This relentless increase in marginal holdings is matched by a corresponding decline in the share of the larger holdings as demographic pressure leads to generational subdivision of land and bottles up the workforce in low-productivity agriculture, saddled with onerous debts. Those “working” in agriculture are, in truth, sharing work with family members. They are hugely underemployed, spending large chunks of their time without any work. Large and growing numbers of them describe themselves as “unpaid household helpers”. The heavy reliance on land at this time of acute and increasing demographic pressure is a poignant commentary on the bleak jobs outlook in non-agricultural activity.
Outside of agriculture, the most important job-creating activity is construction, where (as casual labour) workers are idle on days they do not get work and when they do work, they toil long hours on pitiful wages and often without safeguards to protect them from injury. The much-touted “service-driven” economy provides low-end jobs in restaurants, trade, and transport. Jobs created by the information-technology and allied sectors are so few that they do not show up as a separate category in the official employment data. To put it starkly, both in the level and pace of increase, IT-related jobs are a tiny fraction of the humble “unpaid household helpers”.
Other than pious promises to create more jobs, political leaders campaigning in the recent elections showed no awareness of the grave jobs deficit. And they had nothing to say about the growing moral crisis.
Wrapped up in bureaucratic ineptitude, corruption, and crime, the justice and water systems in Karnataka, as elsewhere in the country, are slow-moving train wrecks. That looming disaster highlights the moral bankruptcy of the political and intellectual elite. Justice and water are not just crucial to economic well-being, they are bedrocks of civilisation.
The number of “pending” cases in Karnataka district courts has risen relentlessly to 1,95,000 in 2021, up 55 per cent from 2015, a somewhat brisker pace than the 45 per cent increase across India over the same period.
The “undertrials” in prison, those charged with crimes but awaiting trial in jail, have also increased relentlessly, up from 69 per cent of all prisoners in 2015 to 75 per cent in 2021, almost exactly matching the all-India averages. These dry statistics are not just a statement of the aphorism “justice delayed is justice denied”, they are markers of a society that turns a blind eye to human rights abuses.
An equal, if not greater, marker of moral degeneration is the stealing of our children’s inheritance. Rainwater flooded Bengaluru city in October 2005 and then again in September 2022. Chief Ministers have come and gone in the interim but the problem gets more acute as chaotic and corruptly authorized urbanisation fills the city’s tanks, lakes, and rivers, choking off the natural drainage of rainwater. With climate change sure to increase the frequency of heavy rainfall events, flooding in Bengaluru, in other Karnataka cities, and all over India is bound to disrupt lives and livelihoods more often and more severely. The mighty river Cauvery as it flows through Karnataka and Tamil Nadu, in the manner of rivers all over India, is being choked and killed by effluents, construction debris, and, especially, illegal sand mining. One activist has warned that the Cauvery might soon cease to exist.
In April this year, Fareed Zakaria, host of a Sunday morning programme on CNN, visited India, his country of birth. His breath was blown away, most of all by Nandan Nilekani and his “vision” that Aadhaar would catalyse multitudes of jobs. Anything is possible. But in the nearly one-and-a-half decades since Aadhaar’s invention, the fastest growing occupations have been in construction and in unpaid household labour.
India’s political and intellectual elite push technological solutions to claim progress and dole out handouts as band-aids to pacify voters. This strategy shies away from the hard work of providing education, good health, jobs, working cities, and justice. The lakes and rivers continue to die.
If the new Karnataka government remains seduced by technology and handouts while ducking the basics, democracy would have again betrayed the people. Voters will remain in pain and have reason to walk away from their “conditional contract” with this government. Hindutva’s visceral appeal will attract even more followers.
Ashoka Mody is Visiting Professor of International Economic Policy at Princeton University. He previously worked for the World Bank and the International Monetary Fund and is the author of India is Broken: A People Betrayed, Independence to Today (Juggernaut and Stanford University Press, 2023).