Wake up to the state of States
Indian Express
P Chidambaram May 18, 2003

Bibek Debroy and Laveesh Bhandari could have been addressing the hearing impaired. Everything that they said — at the India Today-organised meeting to unveil the ranking of Indian States — fell on deaf years, and no one was more deaf, and more livid, than Laloo Prasad Yadav.

Laloo had good reason to be disturbed. The State of Bihar was described as ‘‘the last and the least’’. Of the nine heads that were chosen for ranking the States, Bihar had the distinction of occupying the last rank under six heads, including the head of ‘‘overall performance’’.

In the remaining three, Bihar’s rank out of 19 States was 18, 16 and 16. Laloo ranted and raved, staged a comic walkout and, after a while, returned to defend the realm of Rabri Devi.

It is not easy to rank the States on their performance. The thankless task was undertaken by Debroy and Bhandari using, in their words, ‘‘objective data’’ obtained from Central Government sources, the NCAER library and www.indiastat.com. They picked eight heads (plus the ninth head of ‘‘overall performance’’), identified the parameters under each head, normalised the data, aggregated the variables, used principal components analysis, arrived at a score for each head for each State and ranked the States according to the scores. A pretty impressive effort, considering that it was the first exercise of its kind.
The methodology has its drawbacks. It is invidious to compare small States with big States, for example Goa with Uttar Pradesh. Besides, the States did not start at the same level in 1991. During the decade, exogenous factors like drought, riots or immigration were different for different States.

While the ranking may have been objective, the exercise does not explain — or purport to explain — the reasons for the low rank obtained by some States. The ‘‘State of the States’’ report is a snapshot, and snapshots do not explain why some people are ugly.
The final results were not startling. In fact, they reaffirmed our intuitive conclusions about the performance of the different States since the process of economic reforms began in 1991. It did not require a study to tell us that the worst performing States lie to the east of Kanpur or that Goa, Delhi, Gujarat, Maharashtra and Karnataka have, during the period 1991-2001, grown as fast as the tiger economies of East Asia. In many ways, 1991 to 2001 has been a splendid decade of growth. At the end, however, we find that there are more questions about governance than answers and more fears about the future than hope.

Case for small states
The report makes out a nearly uncontestable case for small States. Goa, Delhi, Himachal Pradesh, Kerala, Haryana and Punjab easily outscore the bigger States. And among the bigger States, it is the biggest in terms of population and size that have performed the worst. With hindsight it is possible to say that that the division of Punjab and Maharashtra were wise decisions; otherwise, would Haryana and Gujarat have recorded such impressive development?

Not all States need to be bifurcated or trifurcated, but if there is a demand based on size, population and geographical characteristics, it seems that division would be a wise solution. The jury is still out on Chhattisgarh, Jharkhand and Uttaranchal, but the early indications are that development will get a boost in these new States unless, of course, misgovernance takes over. In my view, there is a strong case for the creation of Vidharba (out of Maharashtra, population 9.67 crore) and Telengana (out of Andhra Pradesh, population 7.57 crore). Uttar Pradesh and Bihar should also be further divided.
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