Monday, August 17, 2009

Effective Government Spending

I might be sounding like a broken record when I always criticize the 'popular' schemes like "National Rural Employment Guarantee" or on-the-house loan waiving. Even a layman in economics understands that to keep the wheel of economy of a country rolling it's very essential to keep the consumers alive. It's often argued that, thanks to these popular schemes, India hasn't seen the worst of the recession in the past one year.

Well, I don't accept that. That's too short term a perspective. In reality the government has already made a deep hole in its pocket. We'll see serious long term impacts if the government spending is not controlled.

The ongoing drama with the swine flu has shown how much vulnerable our government is when it comes to disaster management. Thank God, that the flu is still restricted to the affluent class mainly in tier one cities.

Just imagine what would have happened if the flu had attacked the hinter lands of our country? Even in the few cities, the government is not capable of providing with the basic infrastructure like the testing equipment. Even the masks required as a precautionary measure are not available in the market. Government is in dire need of cash for buying the testing equipments. I know that the panic with swine flu is a little exaggerated, but still the point remains that the government is not able to spend money in the way it should have in order to tackle the situation.

India's total sending on health is just around 5% of the GDP, out of which only one fifth is government spending. This is a ridiculous amount of money.

It's seems like a joke that Mahatma Gandhi had said, "Health is Wealth". The demographic dividend, that every one is talking about now-a-days, would be a myth if we don't have healthy children growing up to strong adults. Government has a great role to play.

Metrics Statistics Rank in world

Access to sanitation 72% 77th

Drug access 0% 152nd

Hospital beds 0.9 59th

per 1,000 people

Physicians 0.6 19th
per 1,000 people

Water availability 1,880 cubic 123rd

These are just a few statistics. There are many such terrible things that we need to improve and that require serious government expenditure. I'm very sure that anyone, irrespective of his or her level of intelligence and financial background, would value the settting up of an efficient health center in his or her village than anything else.

I just wonder what the government has been doing in all these aspects.

No comments: