Bhagirath Baria

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The Author of this blog has keen interest in understanding Economics and its implications on the Individual and the Economy as a whole. Has been writing articles and analysis of issues that may skip general observation, but exert deep influence on people's lives and their decisions. Discussions and Debates related to conventional as well as non-conventional Economics is done here. The author of this blog doesn't classify himself to any particular School of thought in Economics. He is tilted toward Mainstream Economics, though has keen interest in a few Heterodox schools too. Wishing all the readers a truly enriching experience.

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Rath & Economics by Bhagirath Baria is licensed under a Creative Commons Attribution-NoDerivs 2.5 India License.
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Sunday, July 24, 2011

Land scarcity in India: A reason to worry?

World Map(Please ignore the data table)
Source: http://upload.wikimedia.org


As the above map shows, Land seems to be abundant in the US & Canada compared with their moderate Population. Assuming constancy about the type of land in US, Canada, China & India, we can clearly say that US, Canada & China are having far more amount of the most essential Factor of Production called Land than India. As Kautilya puts in his Arthashastra, "Land is the basic instinct of man". Land is the beginning of all Production activity, then comes the Labour, Capital & the Entrepreneur.

Though at first instance one may reject the importance of this resource by citing the example of nations like Japan, Switzerland, New Zealand & a few more; we are also overlooking the fact that with very less land available, these nations have very less Population to manage too. Coming to our point of discussion, following data clarifies the Land availability in both nations:

Land Area: {In Descending order of land Area}
UNITED STATES: > 3,539,225 sq mi (9,166,601 sq km)
CANADA: > 3,511,003 sq mi (9,093,507 sq km)
CHINA: > 3,600,927 sq mi (9,326,411 sq km)
INDIA: > 1,147,949 sq mi (2,973,190 sq km)

ANALYSIS OF THE WORLD MAP: We can know following important things from the World Map shown above-
  • India has the smallest Land Area
  • United States has the largest land area
  • China & Canada are also bigger in their land areas than ours
  • China's land area is 3.136 times that of India
Looking at the above data, Land scarcity is least in the US & Canada as their Population is very much manageable as compared to China & India. Moreover, in terms of Per-capita income as well as GDP, India is still lagging behind all the other 3 countries being talked about here. HDI(Human Development Index) logic shows India & China have still a long way to reach the standards of Developed World. India ranks at 121st as per the 2010 HDI Report by U.N.D.P. This means India is under the Medium-development ranking nations. Latest HDI Report shows India has slipped to 134th rank; India's Census 2011 too shows that our HDI indicators have degraded especially the Child Mortality rate & Gender ratio.

The point here is, Scarcity of land makes abundance of all other Factors of Production minor. This is evident in the above data. Though India has been growing constantly in terms of GDP & Per-capita Income; It hasn't managed to raise its HDI rankings which are far more important than the Economic achievements. I wish to bring out the fact that India is facing, what we can call "Land Deficiency". Here is why I say so:

  • Real Estate prices are constantly rising in India, many Economists fear of a Real Estate boom in remote future.
  • Constant occurrence of  Land-related issues(Recent ones were those of Bhatta-Parsaul & POSCO plant) show the severe strain that is being exerted by various sectors of the Economy on the precious resource of Land. 
  • Increasing Population is resulting in more & more Resource-share takers in the Economy.
  • HDI indicators remain grim & dark.
Kautilya's views, though comfortably set aside are some of the most essential words as far as management of Land is concerned. The Solution here then is:
  • To make our available usable land more & more Productive; 
  • To strike a balance in the allocation of Land to various sectors;  
  • Promoting Land acquisitions for Production outside the nation by the Private sector; 
  • Utilizing land being kept idle & unproductive; 
  • Snatching away unnecessary acquisitions done by the Politicians & utilizing it for better uses 
  • And finally, making it compulsory for all the Politicians & Policy-makers to read Kautilya's Arthashastra! 

Feel free to express your views, criticism & ideas. This is an attempt to help readers understand the Real Economic problems confronting our Indian Economy so as to spread what's happening & what can be done.

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