Another failed development policy in the works?
A few headlines regarding the World Bank recently caught my eye, mostly because they are not the usual development headlines I am used to reading. In the Business Standard‘s “Migration to urban areas is good, says World Bank,” and domain-b.com‘s “India’s rural job schemes are barriers to development: World Bank news,” the focus is on a new World Bank report that encourages a population shift from villages to cities. More than that, the World Development Report 2009: Reshaping Economic Geography says that current schemes to improve rural life are contrary to development, as pointed out by domain-b.com:
The central government’s National Rural Employment Guarantee (NREGA) scheme and other poverty alleviation schemes act as policy barriers to economic development and perpetual alleviation of poverty, according to the World Bank.
In short, the report encourages the process of rural-urban migration. This approach seems to be the opposite of the upswing of efforts to address rural poverty and improve rural life so that the majority of India’s population has the same economic opportunity as in urban areas. Instead of focus on rural schemes, the report advocates improving infrastructure in cities to boost economic activity. Here is a quick look at the reasoning, as quoted by the Business Standard article:
“The world’s most geographically disadvantaged people know all too well that growth does not come to every place at once,” said Indermit S Gill, director of the World Development Report (WDR) and chief economist, Europe and Central Asia. “Markets favour some places over others. To fight this concentration is tantamount to fighting prosperity,” Gill added.
What does it mean for India when an international force such as the Bank supports a shift from rural to urban areas? Will improving basic infrastructure in urban centers really address the pressure of large increases in city population? While I’m not against migration as a whole, I remain skeptical about putting emphasis on encouraging rural to urban migration and discouraging rural schemes for poverty alleviation. This debate also points back to an earlier post I wrote on urbanization. Is this another development report gone bad?