Kerala Model vs Gujarat Model

In their mid-weekly public policy newsletter, Anticipating the Unintended, Pranay Kotasthane and R S Jaitley discuss the Kerala and Gujarat model of how states have developed.

They suggest that the current situation in both states are the result of history of about two centuries and not just the current government in power in both states. They suggest that the best state model to pursue is to take the best of both worlds.

Perhaps the model to follow is the Travancore state did in the 19th century. Writing about the policies pursued by Travancore, they write:

Travancore was keen to be seen as a model ‘native state’. It privatized landholding and introduced commercial crops in the state. Private property rights means a greater incentive to improve farm productivity. The results were immediate. The state ran a budget surplus for a better part of the 19th century and it used it to invest in education and public health.

Pranay Kotasthane and Raghu Sanjaylal Jaitley, Anticipating the Unintended, #37, May 27, 2020.

There are innumerable social issues that affect Kerala today as it had affected Travancore then. The pandemic exposes Gujarat’s lack of investment in education and public health. But, Kerala is able to invest in these today only because of the gains of private enterprise in the past. In that sense, Kerala seems to be following the Scandinavian model.

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