Wednesday, September 21 2005 11:34 Hrs (IST) - World Time -

Washington: India has a 'highly unequal' social structure in education, jobs as also giving access to loans, and Government intervention is 'profoundly inequitable,' a lead author of World Bank's annual report on global development said today (Sept 21, 2005).

"While it is true that India is today one of the fastest growing economies in the world, that growth is unsustainable unless there is more equity, meaning equal opportunity for advancement for all sections of society," said Michael Walton, who prepared the World Bank's World Development Report 2006 with Francisco Ferrera.

This year's report, prepared under the direction of Francois Bourguignon, the Bank's Chief Economist and Senior Vice President for Development Economics strikes new ground.

While advocating free market policies on the economic side, it is for strong Government intervention to ensure equity, meaning equality of opportunity in education, jobs, access for small entrepreneurs to loans and so on.

Market access, said Walton, is going to be central to a more equitable society, a society on a higher growth path.

Breaking away from past panes of praise for free market as the nostrum for all ills, this year's report stresses that it is equity in society that enhances the power of growth to reduce poverty, infant mortality and social welfare as also speeds up the growth of the economy on a sustainable basis.

On social inequity, Walton cited an experiment in India. Low caste and high caste students performed equally well when the participants did not know each other's caste.

Once caste was revealed, those in lower castes performed poorly.

The report said that equity, defined as equality of opportunities among people, should be an integral part of a successful poverty reduction strategy anywhere in the developing world.

"Equity is complementary to the pursuit of lo -term prosperity," said Bourguignon.

"Greater equity is doubly good for poverty reduction. It tends to favor sustained overall development, and it delivers increased opportunities to the poorest groups in a society," he said.

In the section on India, the World Bank report says that critics argue affirmative action tends to benefit the upper echelon of minority groups, and such programmes are difficult to end.

The programmes are said to apply to sub castes that have not traditionally faced discrimination. They may also reinforce negative stereotypes by placing minorities in positions they are not qualified for.

Despite these weaknesses, India's programme has provided formal sector employment and higher education for many Dalit and Adivasi families, freeing them from subservient roles, it says.

With the reservations in local government, elected women leaders make decisions in line with women's needs and Dalit representatives in village government improve the targeting of benefits to Dalits, it says.