The major reason at an all India level has been the low rate of economic growth. The rate of economic growth in India in the 1960s and 70s was about 3.5% and about 5% in the 80s. This was not significant enough to impart regional equality despite policies consciously designed to favour backward regions being followed. Secondly, the root of these states’ backwardness lies in their socio-economic and political organisation itself. Bihar and eastern U.P. did not have land reforms properly implemented.
In Bihar and Orissa even land consolidation unlike Punjab and Haryana have not taken place effectively. Thirdly, the backward states have a lower level of infrastructural facilities such as power, irrigation, roads telephones and modern market for agricultural produce. Fourthly, these states also have a lower level of social expenditure on education, public health and sanitation.
Besides they suffer from a lack of financial resources to meet plan expenditure. Increased central financial assistance is unable to counter this weakness. A vicious cycle is set up. A low level of economic development and production means less financial resources and limited expenditure on infrastructure, development, planning and social services.
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This low level of expenditure in turn leads to low level of production and therefore financial resources. Fifthly, political and administrative failure also bolsters backwardness. Sheer bad administration and deteriorating law and order creates a bad atmosphere for development.
However, disparities in development also exist within each state. In many cases, this inequality had become a source of tension and given birth to sub-regional movement for separate states within the Indian union.
Examples: Vidarbha in Maharashtra or Telengana in Andhra Pradesh. Secondly, with some economic development taking place and new opportunities for employment, there has grown up a son of the soil moment which posits that the state specifically belongs to the main linguistic group and is their homeland.
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All others who live there are classed as outsiders. Demands are then raised to give preference to the sons of the soil in giving employment and economic opportunities. This has happened in cities like Bombay in Maharashtra or in urban areas of Assam. These movements are another challenge to the Indian nation.