In the year 2005, MNREGA (Mahatma Gandhi National Rural Employment guarantee Act) was initiated. This act guaranteed 100 days of employment providing minimum wage to every households in the districts of rural India. In 2011, this programme received criticisms widely, as it was not being carried out with best intentions. This had led to emergence of corrupt officials, poor quality of infrastructure under this scheme and a negative impact on poverty eradication. In addition to this, it can be said that the economic growth that India has achieved has been driving the employment sector and other areas contributing to the growth of the economy. But a sizeable populace still remains below the poverty line and necessary action needs to be taken for the same.
Prior to the beginning of economic reforms of 1991, India and China have had similar strategies for the development of their respective economies. In 1978, China began the ushering of the new era of market-oriented reform structure wherein the China had to reform its non-market, closed economy. Similarly, until the reforms of 1991, India was under the influence of rigid control of the state (Ahluwalia, 2002). After India experienced a huge macroeconomic crisis, the political environment that India faced became systemic and initiation of reforms of liberalisation, privatisation and globalisation began.
But the consequences of these reforms were very different in the two countries as there is a stark difference in the fundamentals of political environment of India and China. India continues to be a multiparty democracy following an open ideology, while China follows single party regime and has an authoritarian economy (Bajpai, 2002). Both the countries had the capacity to compete in the global market, taking into account the achievements of the reforms undertaken by the SOEs (state owned enterprises).