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How Kerala became one of the most developed states in India? Kerala Model of Development Case Study

How Kerala became one of the most developed states in India? Kerala Model of Development Case Study


  • GS 2 || Governance & Social Justice || Human Development || Concept of Development

Why in the news?

Kerala became one of the most developed states in India

Kerala model of development:

  • The Kerala model of development refers to the development practises used in Kerala, which are marked by strong social indicators such as high literacy, improved access to healthcare, high life expectancy, low infant mortality, and a low birth rate, which are often comparable to developed countries despite having a lower per capita income.
  • Even with modest economic growth, the ‘Kerala model’ of government demonstrates that human development welfare measures are effective.
  • It has also emphasised the significance of the People’s Movement. It puts pressure on the government to implement redistributive policies.


  • Following a period of economic stagnation in the 1970s and 1980s, Kerala’s economic growth accelerated in the late 1980s.
  • Growth in agricultural revenues and remittances fueled a ‘long boom’ in the decades that followed. While the primary sector (which includes manufacturing, construction, and other services) grew the fastest, the secondary sector (which includes manufacturing, construction, and other services) also grew significantly; the proportion of the workforce employed in the secondary sector increased from 20% in 1987-88 to 32% in 2018-19.
  • Kerala’s per capita income was over 10% lower than the national average in 1989-90, but it was 65 percent higher in 2019-20 than the national average.
  • Kerala’s education and health statistics improved throughout this time, and the state’s social security programmes expanded.
  • However, public schools and hospitals were frequently in disrepair, with insufficient facilities driving many people to seek out private service providers.

Kerala’s journey of development:

  • Slow-growing economy:During the economic stagnation of the 1970s and 1980s, many economists anticipated that the Kerala model of governance would fail. The reason for this was that a slow-growing economy would not have sufficient budgetary resources to fund welfare services.
  • Agricultural income and remittances:However, after the 1980s, agricultural income and remittances grew at a faster rate. It gave the economy a lengthy era of expansion. During this period of expansion, the secondary sector’s workforce grew from 20% in 1988 to 32% in 2000. (2018-19).
  • Per capita income:In 1990, per capita income was 10% lower than the national average, but by 2000, it had risen to more than 65 percent of the national average (2019-20)
  • Health and education:Indicators of health and education have improved, and social security programmes have been expanded.
  • Public schools and hospitals:One problem was the state of public schools and hospitals’ infrastructure. Many people were driven to seek employment in the private sector due to a lack of suitable facilities.

Features of Kerala model of development:

  • High material quality-of-life: A set of high material quality-of-life indices that coincide with low per-capita earnings that are shared by almost the whole population of Kerala.
  • Wealth and resource redistribution: A series of wealth and resource redistribution programmes responsible for the high material quality-of-life indicators.
  • Political participation and activism: Ordinary people have a high level of political participation and activism, and there are a large number of dedicated leaders at all levels. Kerala’s mass activity and committed cadre were able to work inside a generally democratic framework, which their action helped to strengthen.

Fundraising innovation:

  • Kerala’s welfare measures were impeded by a lack of enough financial resources as a result of strict borrowing limits imposed by the state. States were no longer able to tax commodities based on their priorities after the GST was enacted. It had an impact on their ability to mobilise resources.
  • KIFB was established in this context to raise funds from the financial market. The theory was that by boosting growth, more government expenditure would raise tax revenues.
  • Ensured debt repayment: By formally pledging to pay a percentage of its earnings from the motor vehicle tax and petroleum Cess, the government ensured debt repayment.

Spending on social infrastructure by the government:

  • ‘Hi-tech’ classrooms:Kerala has spent a significant amount of money in the last five years improving infrastructure for public schools and hospitals. More than 45000 classrooms, for example, have been converted to ‘Hi-tech’ classrooms.
  • ‘Kerala Infrastructure Investment Fund (KIFB)Board’ was used to source the funds.
  • As a result, the number of children enrolled in public schools grew. During the Pandemic, the usefulness of Kerala’s public hospitals was demonstrated.
  • Kerala fibre-optic network: Apart from public schools, KIFB funds were utilised to construct economic infrastructure including as industrial parks, bridges, the Kerala fibre-optic network (K-FON), and the TRANSGRID 2.0 network.

Implications of Investing in Social Infrastructure:

  • Kerala’s unsustainable debt levels are causing concern. The debt to gross state domestic product ratio, for example, is 36 percent.
  • Furthermore, Kerala is extremely sensitive to economic shocks such as natural disasters (floods in 2018, 2019, and the pandemic), job losses in west Asian countries, and the central government’s conflicting fiscal strategy. All of this could have a negative impact on the country’s economic growth.
  • Public spending on social and economic infrastructure, on the other hand, will result in a more skilled, educated, and healthier workforce, as well as better infrastructure. This would ensure that, even in the face of adversity, Kerala will be better able to withstand economic shocks.

Risks associated with development:

  • Kerala’s debt:Concerns have been expressed about Kerala’s debt levels being unsustainable. The KIIFB loans are not included in the stock of outstanding debt, and even if they were, they would only make a minor effect.
  • Industries suffered significant setbacks:The outstanding debt to gross state domestic product (GSDP) ratio in Kerala has been higher than it is presently for various years in the last three decades, according to data (36 percent). Those years followed a time in the late 1990s when the economy’s commodity-producing industries suffered significant setbacks (prices of major cash crops had crashed).
  • Global recession:The current period is similar, with the State experiencing catastrophic floods in 2018 and 2019, as well as the pandemic-induced global recession. Even when economic growth and tax income growth slowed, this resulted in massive unplanned expenses.
  • Natural catastrophes:Instead of debt, the actual dangers are likely to be related with economic shocks like as natural catastrophes, job losses in West Asian nations where many Keralites work, or the central government’s contractionary fiscal policy that could stifle economic growth.

Way Forward

  • State’s Active Role: To make education universal, the state must find resources to provide auxiliary services like school health, mid-day meals, free textbooks, writing supplies, and school uniforms, among other things.
  • The Kerala model demonstrates how comprehensive interventions in nutrition, health, sanitation, and early stimulation can aid in achieving long-term human development growth.
  • Social Auditing: Each village or urban area should have a Village or Mohalla School Committee, which would oversee the construction and upkeep of buildings, playgrounds, and school gardens, as well as the provision of supplementary services, the acquisition of equipment, and so on.
  • The committee will have sufficient finances to carry out its functions thanks to donations and grants-in-aid from the state government.
  • For example, successive Kerala governments have raised capital expenditures for education while simultaneously decentralising education financing through local organisations.
  • Involving Civil Society: Kerala’s success is due to the combined efforts of numerous government ministries, officials, volunteers, non-governmental organisations, and friendly associations.


Development in all aspects is critical for mass literacy, which is a prerequisite for economic development, social structure modernization, and the successful functioning of democratic institutions. It is also an essential first step toward ensuring that all citizens have equal access to opportunities. As a result, the Indian society as a whole should take the required efforts to achieve primary education universalization.

Mains oriented question:

India, which formerly held the title of “Vishwa Guru,” currently ranks first among countries with the highest number of out-of-school children. Discuss what other Indian states can learn from Kerela’s educational programme in light of the statement. (250 words)