Discuss the impact of the new economic policy on the rural economy.
Answers
Answered by
1
One is whether the new economic policy affects in any way the specific policy measures that we normally undertake in order to improve the conditions of the poor. Second, is there anything in the new economic policy which verty programmes. In the total economic policy there are four elements which can be identified as being meant specifically for poverty alleviation:First, since agriculture is the mainstay of the majority of. the population, growth in agriculture and, therefore, resources allocated for agriculture are an important part of the attack on poverty. This is not an acceptance of the trickle-down theory. It is common knowledge that in states in which agriculture has made spectacular progress poverty levels have come down. Therefore, allocation of resources for agriculture is an important indicator.Second, we have evolved over time a reasonably satisfactory food security system. An integral part of this is the public distribution system. With all its shortcomings, the public distribution system has played a notable role in avoiding acute conditions of scarcity and met to a certain extent the minimum requirements.Third, there has been a substantial expansion in programmes which are intended to provide additional employment. The various employment guarantee schemes as well as the credit-related integrated rural development programmes are examples te a difficult situation for labour. That is why various alternative schemes have been thought of, such as the sale of the company to the labour if they are willing to accept it, setting up a national renewal fund to provide compensation for people who may be rendered jobless, etc.The public sector units being compelled to carry on with all the labour force, irrespective of whether or not the units are viable, is also a situation that is not sustainable over a long time. Hence a solution which is also reasonable and acceptable to labour d Kanpur where there has been a concentration of the textile industry.
It must be recognised that restructuring of the workforce becomes necessary for efficient growth which alone can lead to sustainable employment growth in the medium and long term. At the same time, workers rendered unemployed in these processes cannot be left high and dry. Provision for fair and reasonable separation benefits is necessary, but more important is their redeployment, with training, if necessary, as a part of the overall strategy of expansion of employment opportunities.
What, in fact, is being attempted in the new economic policy, with the instrumentality of the national renewal fund, is that the hardships of the workers affected in the unavoidable and inevitable loss of jobs are minimised by providing them a fair deal in terms of separation benefits and opportunities for their productive redeployment.
The national renewal fund, constituted on a non-statutory basis, envisages the provision of resources solely for the rehabilitation of labour resulting from modernisation, technological upgradation, restructuring (including revival) or closure of industrial units.
It will assist workers in this process for their retraining, redeployment and placement in new employment, besides contributing towards compensation payments, including legal dues and those under the Voluntary Retirement Scheme, under the fund called the National Renewal Grant Fund (NRGF).
Far from adversely affecting employment elasticity, the restructured growth during the 1990s is expected to be far less capital-intensive and far more employment-friendly. First, with the removal of distortions in the factor markets, the new economic policy regime can be expected to lead to greater use of labour in the production processes as has been the experience of several labour-surplus developing countries which have succeeded in increasing their exports and overall growth of manufacturing industries. Second, the processes of deregulation and liberalisation are likely to particularly benefit the employment-intensive small and decentralised sector which, it must be recognised, had to bear a heavy burden of bureaucratic hurdles in the past.
In the restructured economy these sectors, particularly the rural non-farm sector, agro- processing and agri-business in general, urban small enterprises and the services sector, all of which have shown high potential for employment generation, are likely to grow faster. Third, the overall objective of the new economic policy is to improve productivity and efficiency. In a competitive environment, both public and private sector units are expected to show improved productivity and greater expansion in output.
It must be recognised that restructuring of the workforce becomes necessary for efficient growth which alone can lead to sustainable employment growth in the medium and long term. At the same time, workers rendered unemployed in these processes cannot be left high and dry. Provision for fair and reasonable separation benefits is necessary, but more important is their redeployment, with training, if necessary, as a part of the overall strategy of expansion of employment opportunities.
What, in fact, is being attempted in the new economic policy, with the instrumentality of the national renewal fund, is that the hardships of the workers affected in the unavoidable and inevitable loss of jobs are minimised by providing them a fair deal in terms of separation benefits and opportunities for their productive redeployment.
The national renewal fund, constituted on a non-statutory basis, envisages the provision of resources solely for the rehabilitation of labour resulting from modernisation, technological upgradation, restructuring (including revival) or closure of industrial units.
It will assist workers in this process for their retraining, redeployment and placement in new employment, besides contributing towards compensation payments, including legal dues and those under the Voluntary Retirement Scheme, under the fund called the National Renewal Grant Fund (NRGF).
Far from adversely affecting employment elasticity, the restructured growth during the 1990s is expected to be far less capital-intensive and far more employment-friendly. First, with the removal of distortions in the factor markets, the new economic policy regime can be expected to lead to greater use of labour in the production processes as has been the experience of several labour-surplus developing countries which have succeeded in increasing their exports and overall growth of manufacturing industries. Second, the processes of deregulation and liberalisation are likely to particularly benefit the employment-intensive small and decentralised sector which, it must be recognised, had to bear a heavy burden of bureaucratic hurdles in the past.
In the restructured economy these sectors, particularly the rural non-farm sector, agro- processing and agri-business in general, urban small enterprises and the services sector, all of which have shown high potential for employment generation, are likely to grow faster. Third, the overall objective of the new economic policy is to improve productivity and efficiency. In a competitive environment, both public and private sector units are expected to show improved productivity and greater expansion in output.
Similar questions