Dr. M. Govinda Rao is one of modern India’s greatest economists. The former Director of the National Institute of Public Finance & Policy now lives on the outskirts of Bangalore and understands the Indian economy better than 99% of India’s economists and C-Suite executives. In this column for the Business Standard, he draws our attention to a remarkable irony, namely, Karnataka is one of India’s richest states (thanks to the booming city of Bangalore) and yet it is one India’s least developed states when it comes to social development metrics. Dr Rao informs us that:
“The state ranks 22nd in underweight children, 21st in stunted children, 20th in secondary school dropouts and 17th in higher secondary enrolment and literacy….A considerable part of Northern Karnataka remains backward in both social and economic development.”
However, in this darkness, two prosperous districts on Karnataka’s West coast stand out: Dakshin Kannada and Udupi. These two districts have fared much better than the rest of Karnataka, despite being cut off from the rest of the state by the Western Ghats.
Dr Rao says that Dakshin Kannada and Udupi have prospered due to:
- Strong connectivity with Mumbai: “…even before the Konkan railway became operational in 1998. As early as the late 1960s and early 1970s, at least 20 private luxury buses operated daily between Mangalore and Mumbai.”
- Large educational institutions: “…the country’s first private self-financing medical college was established in Manipal…”
- An extensive network of banks established a over century ago: “….Canara Bank and Corporation Bank were established in 1906 followed by Syndicate Bank in 1923 and Vijaya Bank in 1924; all of them grew big enough to be nationalised.”
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