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Tuesday, November 12, 2013

Insight: Gujarat’s Muslims In A Politically Correct Trap?

By Surjit Bhalla (Guest Writer)

Time for all PM candidates to end hostilities and present voters with choices about policies, programmes and performance.

The debate about Narendra Modi's economic record has just gone international (perhaps even viral!). In an October 27 editorial, the prestigious New York Times stated in an editorial: "His rise to power is deeply troubling to many Indians, especially the country's 138 million Muslims and its many other minorities. His economic record in Gujarat is not entirely admirable, either." Candidate Modi has changed the contours, and style, of the (presidential?) debate in India. 
His in-your- face style has been enthusiastically joined by the other two aspirants for the PM's post: Rahul Gandhi of the Congress and Nitish Kumar of the JD(U). All three contenders have engaged in objectionable name-calling and the debate is plumbing new lows. For example, Bihar Chief Minister Nitish Kumar recently likened Modi to Hitler. The hope remains that the debate will soon begin to focus on possibilities, policies and performance rather than venom, hatred and contempt.

The specific attention to Gujarat was motivated by the fact that the conventional wisdom has been that, while Gujarat under Modi has been well known for its affinity with the corporate sector and strong GDP growth, it has not been known for inclusiveness of its growth, and particularly for the inclusiveness of those who are Muslim.

An analysis of NSS surveys for 1999-2000 and 2009-10 revealed that Muslims in Gujarat had experienced very little decline in absolute poverty, Tendulkar definition (1.8 percentage points, ppt), in a decade of Modi's rule. In contrast, the SC/STs had shown a large 22 ppt decline over the same period. This singular omission from the growth process was dutifully reported by me, and most commentators applauded my professional dedication, and my conclusion.

The latest data showed a large decline in the poverty levels of Muslims in Gujarat, about 26 ppt in the space of just two years. If the 2011-12 results are "true", then an entirely different conclusion about Modi's governance is obtained. With the 2011-12 data, it appears that Gujarat under Modi has delivered on both growth and governance. However, it did not help that this result was reported in the middle of a heated election campaign. Thus, rather than accepting the new result with all the attendant implications, many have now questioned whether the 2011-12 data are accurate.

Note that all surveys emanate from the same statistical source — the NSS — and should be treated the same. If the 2009-10 data was freely and willingly accepted and endorsed and welcomed, especially by the politically correct (PC) class, why not the same acceptance of the 2011-12 data? At the same time, I fully agree that the large decline in poverty shown between 2009-10 and 2011-12 is statistically suspect and deserves further investigation.

So what really has happened to Muslims in Gujarat under Modi? Both 2009-10 and 2011-12 surveys cannot possibly be right. One of these surveys is an "outlier". One possible explanation for the wide discrepancy is that of a small sample size of Muslims (around 350 sampled households only). The NSS surveys are not designed to capture the consumption behaviour of a subset of population and, in Gujarat, Muslims constitute less than 10 per cent of the population.

There are some tabulations that can help identify the outlier year. One can compare the percentage of poor Muslims in Gujarat with the percentage of poor Muslims in India for the longish time period of 1983 to 2012. In five large sample NSS survey years since 1983 (there have been six), Gujarati Muslims have had a lower than average all-India poverty, and lower by about 9 ppt. Except in 2009-10, when this fraction was higher in Gujarat by 2 ppt! Second, as reported in my most recent article (and not mentioned by the PC sceptics) is the fact that almost every disadvantaged group in Gujarat reports near identical declines in the poverty rate between 1999-2000 and 2011-12 — about 30 ppt. 

Thus, it appears that several statistical criteria favour rejecting the estimate provided by the 2009-10 NSS data. In addition, note that the only reason there was a large sample survey in 2011-12 was because 2009-10 was considered untrustworthy by the government for two valid reasons — it was both a drought year and a global financial crisis year.

One final calculation remains. It is well recognised that the reduction of poverty from 50 to 30 ppt is a lot easier than an equivalent 20 ppt reduction from 30 to 10 ppt. In other words, for assessment of poverty decline, the initial level of poverty matters. One method of evaluating poverty reduction is to look at the percentage declines in the poverty ratio. The table reports such percentage declines for all states in India with a Muslim population above 6 per cent and for the period 2004-05 to 2011-12. 

This later time-period is chosen to make comparisons with Bihar possible (calculations for 1999-2000 to 2011-12 yield the same qualitative results and rankings for Gujarat). For Muslims, Gujarat had the third highest decline among 15 states in the country and for SC/STs, the eighth highest decline. For the disadvantaged groups together, Gujarat's rank is sixth (not shown in the table) and seventh for OBCs. Modi's political, governance and growth comparator and competitor Nitish Kumar obtains the following disappointing rankings: ninth for both Muslims and SC/STs, 11th for the disadvantaged, and 10th for OBCs.

There are several other pieces of information that can, should and will be examined in future. The discussion about poverty decline is a humble start towards a more desirable debate about the economic governance of the different "presidential" candidates.
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