North-South, real gaps, false binary

The key to southern India’s superior economic performance has been its relative success with population control. It’s also the cause of the region’s deepest fears over losing economic and political weight due to fiscal and electoral systems based on population. The southern states lead in almost all economic and development metrics because of a common market for their industrial goods as well as supply of cheap labour from the agrarian north. To that extent, they are comfortable with a stronger federal structure that taxes uniformly and improves infrastructure to allow business to acquire national scale. But these strengthening tendencies accompany bigger transfer of resources to poorer northern states and would give them a larger political voice when constituency delimitation is resumed after a half-century hiatus. Both processes are constitutional requirements.

Some of the south’s wariness is misplaced. Urbanisation leads to the same effects of increased economic clout combined with political marginalisation. And the north is urbanising faster than the south, in part because of a low base. Since migration is overwhelmingly intra-state, the model of economic development is becoming geographically diversified. The factors contributing to a common market are also driving urbanisation. Constituency delimitation with a third of India’s people living in cities will heighten rural-urban political differences rather than a ‘north-south divide’.

It would be in the interest of the southern states to push their economic advantage to pull up the northern laggards. India’s federal structure has been alive to the former’s cultural and political concerns, and that has resulted in their overachievement. They are now free to export their development model. Growth rates among states are expected to even out with greater market integration domestically and with the rest of the world. This would de-emphasise culture-specific models successful at select points of a nation’s economic development.