Read this article to learn about how to bring balance among different sectors of an Economy!
There are some basic factors which have rightly been recognized as fundamental conditions for bringing balanced among different sectors of the economy.
1. Formation and Implementation of Plans:
The first condition for the success of balanced growth is the formulation and implementation of various plans for getting smooth development among different sectors. It requires the fixation of financial and physical targets for different sectors.
The priorities should be given according to the socio-economic objectives. Planning is required to ensure smooth functioning of the various sectors of the economy. There must be co-ordination of economic activities on a fairly rational basis keeping in view all alternative possibilities of investment.
2. Co-ordination among Different Development Programmes of the Government:
Planning merely provides the path for implementing the various development programmes but the actual execution of programmes is to be carried out by different agencies which need the proper co-ordination at all levels. Thus, balanced growth requires the integration among the different development policies so that all sectors remain in balance. It is only possible by the method of integration through co-operation, co-ordination and proper understanding among different departments of the government.
3. Positive Role of Government:
Modern states are the welfare states. Without the intervention of government, no fruitful results are possible. The state can enforce and maintain law and order in and economy for harmonious development. The state can mobilize the resources through taxes, borrowing, deficit financing to meet the financial requirements of the balanced growth. The state can undertake the welfare activities for the creation of human capital.
These functions are not possible at the hands of private entrepreneurs as they are intended for profit maximization. But, state intervention is needed to channelize its resources for social welfare activities. These activities are much more conducive for balanced growth.
4. Public Co-operation:
The ultimate success of balanced growth depends upon public co-operation. It is not essential only for political stability but also for economic advancement. In the opinion of Prof. W.A. Lewis, “Public co-operation is both the lubricating oil for planning and petrol of economic development—a dynamic force that almost makes all things possible. People should be well aware of their duties. They should be made partners of development activities in the state. Every development activity at their behest would not lead to individual benefits but would enhance social and economic welfare of the common lots”.
5. Favourable Environment:
Another essential condition for the success of balanced growth is the creation of favourable environment for the economic development. The development programmes should be framed considering local conditions, such as, availability of resources both material and human, level of technical know-how, institutional factors, level of development already attained and similar other factors. The optimum combination and use of such factors can ensure the balanced growth.