Introduction

This document consists of 3 sections

1) Section I: In this part we shall be giving you 10 marker questions. These are supposed to be
somewhat direct and easy as compared to 15 marker questions
2) Section II: In this part we shall be giving you 15 marker questions. These are supposed to be little
complex or consisting of multiple sub-questions or may be an integrated question from concepts
of different chapters
3) Section III: There is one homework question for you to think and write. The answer for this
question will not be given by us.

Other Guidelines

1) The answers given here are not to be crammed. They are not given from the perspective of being
perfect answers. No answer is a perfect answer. If we ask 500 people to write answers to these
questions, then we will get 500 different answers and we cannot decide which one is perfect
answer. The answers given here is to help you guide towards the approach to answer writing.
2) The answers written here may exceed the word limit in some cases. But that is done intentionally,
so that you understand it better and in exam you can further summarize that information to
achieve the desired word-limit.
3) In certain answers, the content/points written may not be covered in the notes/videos. But that
is also done to make you realize that we cannot simply be bookish in writing answers, rather
some content/points need to be written from our understanding of things. This is called the
application part
4) We would recommend that questions to the answers should not be just read. What you shall do
is
A. For 2-3 questions, please write answer in your
own words so that you get practice for
Measurement of
descriptive writing. Then try to match your
answer with answer given by us and try to Growth
self-evaluate
B. For the rest of the questions, try to make an outline as in what you will write in this answer.
Then try to match your outline with answer given by us and try to self-evaluate

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 Introduction
This document consists of these sections.

1) Descriptive Fodder material: This document begins with crisp descriptive fodder
material that contains important facts and data related to the topics/concepts
discussed in the lecture videos. It is designed to provide additional information that
can be used in descriptive writing.

2) 10 Marker Questions: In this part we shall be giving you 10 marker questions. These
are supposed to be somewhat direct and easy as compared to 15 marker questions.

3) 15 Marker Questions: In this part we shall be giving you 15 marker questions. These
are supposed to be a little complex or consisting of multiple sub questions or may
be an integrated question from concepts of different chapters.

4) Previous Year Descriptive Questions: There are no previous year descriptive

questions as this is introduced for the first time in 2021.

5) The exam was conducted in an objective pattern till 2020. Hence, for these years
no subjective questions are available.

6) Homework Question: There is one homework question for you to think and write.
The answer for this question will not be given by us.

Other Guidelines

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 1. The answers given here are not to be crammed. They are not given from the
perspective of being perfect answers. No answer is a prefect answer. If we ask
500 people to write answers to these questions, then we will get 500 different
answers, and we cannot decide which one is the perfect answer. The answers
given here is to help you guide towards the approach to answer writing.

2. The answers written here may exceed the word limit in some cases. But that is
done intentionally, so that you understand it better and in exam you can further
summarize that information to achieve the desired word limit.

3. In certain answers, the content/points written may not be covered in the

notes/summary sheet. But that is also done to make you realize that we cannot
simply be bookish in writing answers, rather some content/points need to be
written from our understanding of things. This is called the application part.

4. We would recommend that questions to the answers should not be just read.
What you shall do is
a. For 2-3 questions, please write answer in your own words so that you get
practice for descriptive writing. Then try to match your answer with the
answer given by us and try to self-evaluate.
b. For the rest of the questions, try to make an outline as to what you will
write in this answer. Then try to match your outline with the answer given
by us and try to self-evaluate.

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 1 Descriptive Fodder Material
1.1 Inclusive Growth
Economic growth was earlier seen as an inclusive concept, automatically supposed to be for all.
But growth experience the world over has shown otherwise. The poor, history has revealed,
need to have a special mention lest the rest of the country forgets them as it forges ahead on
the growth path.

Growth, though fundamental for reducing the level of poverty and improving living standards of
our people, is not enough by itself. It needs to be more inclusive, more pervasive &
accompanied by moderate inflation.

'Inclusive Growth’ has thus emerged as a concept in Economics. This is reflected in India’s 11th
Five-Year Plan (2007 – 2012) had the theme 'towards faster and more inclusive growth'.

1.1.1 Elements of Inclusive Growth

1.1.1.1 Skill Development

• Harnessing the demographic dividend will depend upon the employability of the working age
population, their health, education, vocational training and skills. Skill development plays a
key role here.
• India is facing a dual challenge in skill development:
o First, there is a paucity of highly trained workforce
o Second, there is non-employment of conventionally trained youths
• According to the Multiple Indicator Survey in India 2020-21, 30.2 percent of persons in rural
areas and about 27.0 percent of persons in urban areas of age 15-24 years were not in
education, employment or training (NEET) as on date of survey.
• Another report, which is India Skills Report 2024: Indian employable talent leaps from 50.3%
to 51.25%.

1.1.1.2 Financial Inclusion

• Financial Inclusion is the process of ensuring access to financial services to vulnerable groups
at affordable costs.
• Financial inclusion is necessary for inclusive growth as it leads to the culture of saving, which
initiates a virtuous cycle of economic development.
• For ensuring this, RBI released the National Strategy for Financial Inclusion 2019-24.

• The Reserve Bank of India (RBI) released the National Strategy for Financial Inclusion
2019-2024. It sets forth the vision and objectives of financial inclusion policies in India.
• Steps taken for financial inclusion: The RBI noted that several steps have been taken
to further financial inclusion in the country. These include:
➢ Pradhan Mantri Jan Dhan Yojana (PMJDY)
➢ Schemes such as the Pradhan Mantri Suraksha Bima Yojana
• Strategic objectives for financial inclusion: RBI identified six strategic objectives of a
national strategy for financial inclusion:

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 ➢ universal access to financial services,
➢ providing basic bouquet of financial services,
➢ access to livelihood and skill development,
➢ financial literacy and education,
➢ customer protection and grievance redressal, and
➢ effective coordination.
To achieve this vision, it identified certain milestones such as: (a) providing banking access
to every village (or hamlet of 500 households in hilly areas) within a five km radius by March
2020, (b) strengthening digital financial services to create infrastructure to move towards
a cash less society by March 2022, and (c) ensuring that every adult has access to a financial
service provider through a mobile device by March 2024.

1.1.1.3 Technological Advancement

• The world is moving towards an era of Industrial Revolution 4.0. These technological
advancements have capabilities to both decrease or increase the inequality depending on the
way these are being used.
• Several initiatives have been taken by the government, e.g., Digital India Mission, so that a
digitally literate population can leverage technology for endless possibilities.
• Various technologies are being evolved like 5G trial, Artificial Intelligence, Robotics, Nano
technologies etc.
1.1.1.4 Economic Growth
• India is among the fastest-growing major economies in the world. However, currently Indian
economy is facing slowdown due to both cyclic and structural challenges.
• However, the target of becoming a $ 5 trillion economy by 2025 can allow India to reduce
inequality, increase social expenditure and provide employment to all.
1.1.1.5 Social Development
• It means the empowerment of all marginalized sections of the population like
SC/ST/OBC/Minorities, women and transgenders.
• Empowerment can be done by improving institutions of the social structure i.e., hospitals
especially primary care in the rural areas, schools, universities, etc.
• Investment in social structures will not only boost growth (by fiscal stimulus) but will also
create a healthy and capable generation to handle future work.
• Various steps have been taken like Ayushman Bharat, Eklavya Model Residential School for
welfare of Scheduled Tribes, etc.
1.1.2 Sustainable Economic Growth and Inclusive Growth
Sustainable Development & Inclusive Growth are dependent on each other. To be Sustainable,
growth needs to be Inclusive.

Economic growth may give rise to inequalities & corruption. Certain sections of the population
may benefit to the exclusion of others. There may not be parity of opportunity in terms of access
to markets, resources, & impartial regulatory environment for businesses and individuals.
Especially in the short run, growth may seem to make the rich richer & the poor poorer.

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 But the inclusive growth approach takes a longer-term perspective, emphasizing productive
employment to as a means of increasing the incomes and therefore the living standards of poor
and excluded groups.

1.1.3 Human Development and Inclusive Growth

Human Development & Inclusive Growth are
closely related. Growth which is not Inclusive
cannot in fact achieve the literacy and life
expectancy levels required for satisfactory
Human Development. Simply a high rate of GDP
(even if at PPP US$) whose benefits do not
percolate to all economic classes is neither
inclusive nor human. Only by reaching literacy,
and good health to all, and only by ensuring
better public distribution system can a higher
HDI be reached. Human development, which is about expanding people’s choices, builds on
shared natural resources. Promoting human development requires addressing sustainability-
locally, nationally and globally –and this can & should be done in ways that are equitable and
empowering.

1.1.4 Dimensions of Inclusive Growth

'Inclusive growth' is a process in which, economic growth, measured by a sustained expansion
in GDP, contributes to an enlargement of the scale & scope of all four of the following
considerations.

1.1.5 Challenges in Achieving Inclusive Growth

1.1.5.1 Poverty
• According to the Global Multidimensional Poverty Index 2023, 415 million people in India
were able to escape multidimensional poverty in the last 15 years between 2005–2006 and
2019–21, with the incidence of poverty exhibiting a sharp drop from 55.1% to 16.4%

1.1.5.2 Unemployment
• As per the Periodic Labour Force Survey (PLFS) for 2022-23, the unemployment rate is 3.2%
as against 4.1% in 2021-22.
• The quality and quantity of employment in India are low due to illiteracy and due to over-
dependence on agriculture.
• The quality of employment is a problem as more than 80% of people work in the informal
sector without any social security.
• Low job growth is due to the following factors:
o Low investment
o Low capital utilization in industry
o Low agriculture growth

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 1.1.5.3 Agriculture Backwardness
• According to Economic Survey 2023-24, Indian agriculture sector provides livelihood support
to about 42.3 per cent of the population and has a share of 18.2 per cent in the country’s GDP
at current prices.
• Issues in agriculture are as follows:
o Declining per capita land availability
o A slow reduction in the share of employment
o Low labour productivity
o Decline in agriculture yield due to climate change, land degradation and unavailability
of water
o Disparities in growth across regions and crops
1.1.5.4 Issues with Social Development
• Social development is one of the key concerns for inclusive growth. But it is facing some
problems such as:
o Significant regional, social and gender disparities
o Low level and slow growth in public expenditure particularly in health and education
o The poor-quality delivery system
o Social indicators are much lower for OBC, SC, ST, and Muslims
o Malnutrition among the children
India ranks 111 out of a total of 125 countries in the Global Hunger Index (GHI) 2023

1.1.5.5 Regional Disparities

• Regional disparities are a major concern for India. Factors like the caste system, gap between
rich and poor etc. contribute to the regional disparities which create a system where some
specific groups hold more privileges over others.
• Some of the regional disparity’s problems are as follow:
o According to Ministry of Education in 2023, In terms of literacy rate, Kerala is the
most literate state with 94 % literacy, on the other hand, literacy rate of Bihar is only
61.80%
o In terms of per capita income, Bihar’s per capita income is just one tenth of Sikkim.

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 Section I
10 Marks – 400 Words

Q.1) What strategic initiatives and global suggestions can countries adopt to
achieve inclusive growth similar to India's approach?

Answer
In pursuit of equitable and comprehensive development, India has implemented a range of strategic
initiatives to achieve inclusive growth. By fostering a conducive environment for social and economic
progress, India aims to create a more equitable society and ensure that the benefits of growth reach every
segment of its population.

The following are some strategies that can be taken to achieve inclusive growth:

Initiatives

1) Mahatma Gandhi National Rural Employment Guarantee Act Scheme (MGNREGA): This initiative
stands as one of the globe's largest work assurance programs. It centers on ensuring 100 days of
employment during each fiscal year for adult members of rural households who are prepared to engage
in unskilled manual labor related to public projects.

2) Mudra Bank scheme: Designed to bolster small business enterprises, this scheme offers collateral-free
institutional loans of up to Rs. 10 lakhs, facilitating financial support for the growth and development of
these enterprises.

3) Sarva Siksha Abhiyan (SSA): With the goal of achieving universal elementary education, SSA is focused
on eliminating gender and social disparities in education. Its objectives include enhancing the quality of
education and boosting retention rates in primary and upper primary schools.

4) Pradhan Mantri Jan Dhan Yojana: Operating as the National Mission for Financial Inclusion, this
initiative ensures economical access to various financial services, including banking, savings and deposit
accounts, remittance, credit, insurance, and pension services.

World Economic Forum has suggested ways by which countries can boost social inclusion as well as
economic growth:

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 1) Boosting Citizens' Capabilities: Countries are urged to enhance public and private investments in
citizens' abilities, driving sustained productivity growth.

2) Modernizing Work Rules: Governments, employers, and workers must collaborate to strengthen work
regulations, influencing job opportunities, compensation, and aggregate demand.

3) Labor-Intensive Sectors: Encouraging investment in labor-intensive sectors to generate wider benefits

for society.

To ensure that the benefits of economic growth are shared by everyone, the following can be done:

Way Forward

1) Strengthening social safety nets: This will prevent vulnerable individuals from slipping into poverty
during hardships, allowing them to participate in and contribute to the economy.

2) Affordable housing: It would provide stable living conditions for low-income families, enabling them to
engage more fully in economic opportunities and upward mobility.

As India continues its journey towards inclusive growth, it is poised to unlock the full potential of its
diverse population, harnessing their skills and energies to drive economic prosperity and social well-being.
Through persistent dedication to these strategies and an unwavering commitment to equitable
development, India can set an example for the world in achieving inclusive and sustainable growth that
leaves no one behind.

Q.2) How does Green GDP enhance the comprehensive assessment of a

nation's well-being and economic performance?

Answer
Green Gross Domestic Product (GDP) represents a significant evolution in how we assess a nation's well-
being and economic performance. It recognizes the intricate interplay between economic growth and
ecological well-being, offering a more nuanced understanding of progress in today's increasingly
interconnected world.

Green GDP has emerged as a pivotal tool in aligning economic progress with environmental preservation
in the following ways:

Significance of Green GDP

1) Environmental Valuation: The Green GDP incorporates the assessment of aspects often treated as
externalities in conventional GDP computations. This method quantifies the economic worth of ecological

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 elements, resulting in a more precise gauge of the genuine costs and advantages tied to economic
endeavors.

2) Sustainability: Aligned with the principles of Sustainable Development Goals, the Green GDP
framework explicitly integrates environmental factors into economic evaluations ensuring a
comprehensive understanding of the trade-offs between economic growth and ecological sustainability.

3) Relevance to Policy: By offering a comprehensive overview of economic performance, the Green GDP
facilitates the pinpointing of sectors and activities exerting significant environmental impacts, guiding
focused interventions and regulations aimed at achieving sustainable development objectives.

4) Effective Resource Management: The Green GDP approach acknowledges the economic value of
resources and propels their conservation and prudent utilization leading to enhanced resource allocation
and diminished environmental degradation.

While Green GDP is significant, its successful implementation faces a set of challenges:

Challenges

1) Data Reliability and Availability: The calculation of green GDP faces difficulties stemming from the lack
of reliable data regarding environmental costs, benefits, and the value of natural resources. This results
in estimations relying on assumptions and subjective judgments, compromising both reliability and
comparability.

2) Policy Implementation and Trade-offs: While green GDP holds utility, translating it into effective
policies requires addressing obstacles and garnering political support. Moreover, striking a balance
between economic growth and environmental preservation is intricate and context-dependent, making it
difficult to formulate universally applicable policies solely based on green GDP.

Navigating these challenges can harnessing the full potential of Green GDP as a transformative tool for
sustainable development:

Way forward

1) Enhancing Data Quality and Availability: An essential step involves enhancing the quality and
availability of environmental data, including metrics like emissions, resource utilization, and ecosystem
services. Consistency and comparability across countries are vital for reliable green GDP calculations.

2) Raising Awareness and Understanding: Advocacy is crucial to the success of green GDP. Efforts should
be made to raise awareness, foster understanding and highlighting the advantages of green GDP over
conventional GDP as a comprehensive measure of economic performance and societal well-being can
drive support.

Green GDP significantly enhances the comprehensive assessment of a nation's well-being and economic
performance. Through its holistic approach, it has the potential to pave a path towards a future where

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 the twin goals of economic prosperity and environmental preservation harmoniously coexist, ensuring a
sustainable legacy for generations to come.

Q.3) How does the Human Development Index (HDI) offer a holistic assessment
of human welfare, and what key criticisms have been voiced concerning its
approach and consequences?

Answer
The Human Development Index (HDI) stands as a pioneering metric that transcends conventional
economic measures, delving into the multifaceted tapestry of human welfare. By intricately weaving
together indices of life expectancy, education, and income, the HDI offers a panoramic lens through which
to assess a nation's development.

HDI offers a new lens for evaluating development and brings certain advantages:

Advantages

1) Comprehensive Assessment: HDI provides a holistic and comprehensive view of a country's

development by considering multiple factors that contribute to human well-being. This goes beyond
economic indicators like GDP and provides a more nuanced understanding of development.

2) Focus on Human Well-being: HDI focuses on improving the quality of life for individuals, emphasizing
factors that directly impact people's well-being, such as health and education. It places people at the
center of development efforts.

3) Accountability and Transparency: HDI promotes transparency by making a country's development

performance accessible to the public and policymakers. This can lead to greater accountability as
governments are held responsible for their progress or lack thereof.

4) Equity and Social Inclusion: HDI takes into account disparities in health, education, and income within
a country. By highlighting inequalities, it encourages efforts to reduce disparities and promote social
inclusion.

5) Global Development Agenda: HDI is a widely recognized measure that contributes to the global
development discourse. It provides a common language for discussing development goals, which can
facilitate international cooperation and coordination.

Despite the advantages, HDI is not immune to scrutiny and critiques:

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 Critical Observation

1) Methodological Limitations and Incompleteness: The HDI's reliance on incomplete, ever-changing data
and exclusion of non-UN countries raises concerns about calculation consistency and accuracy.

2) Development Bias and Exclusions: Formula alterations in the HDI disrupt series continuity, assessing
development unevenly across country groups and favouring a 'Western' model while disregarding
important moral, spiritual, and ecological dimensions.

3) Narrow Focus and Competitive Approach: The HDI's exclusive emphasis on national performance
neglects crucial ecological, technological, and scientific development aspects. This narrow focus fosters
competitiveness, potentially obstructing broader global cooperation, peace, and progress.

Continuing the journey necessitates the refinement of HDI through:

Way Forward

1) Inclusive Development Goals: Collaborate with international bodies to align the HDI with broader
development agendas, such as the Sustainable Development Goals (SDGs), fostering a cohesive and
unified approach to global progress.

2) Technological and Scientific Advancement: Extend the HDI's lens to encompass technological and
scientific progress, fostering innovation and knowledge-sharing as integral components of human
development.

Amid various perspectives, the Human Development Index serves as a valuable tool. It helps us
understand people's well-being and the challenges they face. It motivates us to improve and ensure that
progress benefits everyone across the globe.

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 Section II
15 Marks – 600 Words

Q.1) Gross Domestic Product (GDP) of a country cannot be taken as an index of

the welfare of the people of that country. Analyse.

Answer
In an increasingly interconnected and complex world, assessing a nation's progress requires a more
nuanced approach than just relying on Gross Domestic Product (GDP). While GDP has long been the
conventional yardstick for measuring economic performance, it is essential to recognize its limitations and
explore alternative measures that offer a more comprehensive understanding of a society's well-being
and progress.

The factors undermining the accuracy of GDP as a measure of a country's welfare include:

Reasons

1) Ignores Income Distribution: GDP doesn't account for how income and wealth are distributed among
the population. A country with a high GDP might still have significant income inequality, leading to
disparities in living standards and access to basic needs among its citizens.

2) Non-Market Activities: GDP focuses primarily on market activities and does not consider non-market
activities like household work, volunteering, and informal sector activities. These activities contribute to
people's well-being but are not directly reflected in GDP.

3) Quality of Life Factors: GDP doesn't capture important quality of life factors such as healthcare,
education, environmental quality, safety, and social services. A country might have a high GDP but still
have inadequate healthcare and education systems, leading to lower overall well-being.

4) Externalities and Negative Impacts: GDP growth can sometimes be driven by activities that have
negative social or environmental consequences, such as pollution, overconsumption, and excessive use
of non-renewable resources. These activities can harm well-being in the long run.

5) Quality vs. Quantity: GDP measures the total value of goods and services produced, but it doesn't
distinguish between products that contribute positively to well-being (e.g., healthcare, education) and
those that may have negative effects (e.g., tobacco, weapons).

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 Several alternative measures that offer the potential to overcome the limitations of GDP, providing a more
comprehensive assessment of a country include:

Alternative Measures

1) Human Development Index (HDI): HDI is a summary measure of average achievement in key
dimensions of human development: a long and healthy life, being knowledgeable and having a decent
standard of living. The HDI is the geometric mean of normalized indices for each of the three dimensions.

2) Multidimensional Poverty Index (MPI): MPI seeks to understand poverty beyond monetary
deprivations by including access to education and basic infrastructure along with the monetary headcount
ratio at the $2.15 international poverty line.

The government can implement groundbreaking measures aimed at deepening the comprehension of the
well-being of its citizens along the lines of the following:

Suggestions

1) Mental Health Indicators: Incorporating psychological well-being into assessments of population

welfare is crucial. By integrating mental health indicators, policymakers gain a comprehensive
understanding of the holistic health of a population, beyond just physical well-being.

2) Cultural Indicators: Create indicators that effectively capture the profound significance of culture and
the arts. These indicators serve as a lens to comprehensively assess a society's cultural and artistic
vibrancy, shedding light on their pivotal role in enhancing both individual and collective well-being.

To ensure accuracy in measuring the welfare of the people and prioritize the overall well-being of a
country, the following steps should be undertaken:

Way Forward

1) Policy Integration: Integrate well-being indicators into policy discussions and decision-making
processes at all levels of government. Well-being considerations should guide resource allocation,
development plans, and regulatory decisions.

2) Regular Evaluation and Adjustment: Well-being measures and policies should be regularly evaluated
and adjusted based on new data, changing societal values, and evolving challenges. Flexibility is important
to ensure the continued relevance of these measures.

The shortcomings of relying exclusively on Gross Domestic Product (GDP) to gauge societal progress have
become increasingly apparent within our intricate and interwoven global landscape. However, by
embracing alternative measures, societies can adopt a more nuanced perspective on progress. Ultimately,
redefining progress beyond GDP is not just a paradigm shift; it is a commitment to building a more
prosperous and harmonious society for all.

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 Q2) What do you understand by the term economic development and how
recently released Human Development Report 2022 indicates a long journey
ahead for India in the way of economic development?

Answer
According to Amartya Sen, development is about creating freedom for people and removing obstacles to
greater freedom. When people have more freedom, they can choose their own destiny. Sen identified
numerous barriers to freedom and, consequently, development—such as poverty, limited economic
prospects, corruption, subpar governance, inadequate education, and restricted healthcare access.
Despite India's strides forward, the Human Development Report 2022 underscores the substantial journey
that remains to be undertaken in realizing all-encompassing development.

The Human Development Report 2022 sheds light on the challenges India faces, indicating a
formidable journey ahead in terms of economic development:

Challenges

1) Slow Progress: While India's economy has witnessed growth, this progress hasn't mirrored a
proportional rise in its Human Development Index (HDI), positioning it at 132 out of 191 countries. In
2022, India's HDI value stood at 0.633, which was lower than the world average of 0.732.

2) Educational Disparities Persist: While the anticipated years of schooling amount to 11.9, and the
average years of schooling reach 6.7, the persistent imbalance in educational access and quality remains
a formidable hurdle.

3) Income Disparity and Gender Dynamics: Evidenced by the Gender Development Index (GDI) at 0.490,
an eminent gender gap emerges, notably in per capita income, where women lag behind men. This
disparity disproportionately hampers women, thereby obstructing India's holistic human development
journey.

4) Gender Inequity: The Gender Inequality Index (GII) ranks India 122nd, highlighting substantial
disparities faced by women in areas such as reproductive health, empowerment, and engagement in the
labour market.

5) Multifaceted Deprivation: India continues to confront a considerable segment of its population

grappling with multidimensional poverty, encompassing challenges related to health, education, and the
standard of living.

Despite the multitude of challenges highlighted in the report, India has also demonstrated notable
progress on certain parameters:

Achievements

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 1) Strengthening Policy Implementation: India showcases leadership in investment, insurance, and
innovation, with a focus on transformative policies. For instance, the country has prioritized renewable
energy and social protection measures. Additionally, India has undertaken the largest vaccination drive,
supported by UNDP, to combat the COVID-19 pandemic.

2) International Contributions to Sustainable Development: India leads initiatives like the International
Solar Alliance and the Coalition for Disaster-Resilient Infrastructure. These initiatives address climate
change, promote renewable energy, and contribute to global sustainable development. Furthermore,
India's efforts in providing global health support through COVID-19 vaccines demonstrate its commitment
to international collaboration.

The Indian government steadfastly pursues its objective of comprehensive development through
unwavering and persistent efforts by:

Initiatives

1) Gender Budgeting: A gender-responsive budget is a budget that acknowledges the gender patterns in
society and allocates money to implement policies and programmes that will change these patterns in a
way that moves towards a more gender-equal society.

2) National Multidimensional Poverty Index: The National Multidimensional Poverty Index Project is
aimed at deconstructing the Global Multidimensional Poverty Index and creating a globally aligned and
yet customised index for drawing up comprehensive Reform Action Plans with the larger goal of improving
India’s position in the Global MPI rankings.

To ensure a more equitable distribution of the benefits of economic growth, governments must prioritize
human development alongside economic progress:

Way Forward

1) Prioritize Human Development: The government must prioritize human development alongside
economic growth. This entails investing in social infrastructure, including healthcare, education, and basic
amenities in underdeveloped regions. Access to quality social services should be enhanced to ensure
equitable distribution of benefits.

2) Strengthen Governance and Accountability: Enhance governance mechanisms and address corruption
through transparent and accountable systems. Good governance practices, including effective public
service delivery, institutional reforms, and anti-corruption measures, are crucial for sustainable economic
development.

While India has achieved significant milestones in its development journey, the Human Development
Report 2022 sheds light on the challenges that lie ahead on the path to comprehensive development.
India's journey toward comprehensive development is a long one, but with collective determination,
strategic policies, and continued commitment, it has the potential to overcome these challenges and build
a brighter future for its people.

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 Q.3) What are the significant barriers that prevent inclusive economic growth,
and how do the strategies aimed at overcoming these barriers effectively
contribute to creating a more inclusive form of economic development?

Answer
In the journey towards nurturing a more inclusive framework for economic progress, it becomes
absolutely essential to not only recognize but also effectively address the formidable barriers that obstruct
the path to balanced and fair growth. It is crucial to both recognize these challenges and actively engage
in their resolution. The aim is to cultivate a harmonious and just economic environment that elevates and
empowers every individual, thereby nurturing a more promising and radiant future for all.

Navigating the barriers to inclusive growth and forging strategies to dismantle them towards a more
equitable and prosperous future can be done by:

1. Inclusive Agriculture Growth

Barrier: Despite its potential, the agriculture sector's role in inclusive growth has been underemphasized.
A significant portion of the population depends on agriculture, yet its contribution to GDP remains
disproportionately low at 19%. This disconnect hampers equitable development.

Strategy: Promoting inclusive agricultural growth requires a multi-faceted approach. Upgrading irrigation
systems can counter water scarcity, boosting crop yields and rural livelihoods. Streamlining input
distribution ensures farmers access quality resources, enhancing productivity. Fair pricing safeguards
incomes and diversifying into value-added sectors like animal husbandry sustains earnings.

2. Manufacturing-Led Diversification

Barrier: Economic diversification is pivotal for sustainable growth, yet India's manufacturing sector
remains underdeveloped. Over-reliance on certain industries makes the economy susceptible to shocks,
hindering overall progress.

Strategy: Stimulating manufacturing-led diversification demands specific actions. Investing in R&D drives
innovation, propelling new industries. Addressing skills gaps via vocational training equips the workforce,
while infrastructure improvements enhance competitiveness. This approach fuels manufacturing and
interconnected sectors.

3. Labor Force Activation:

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 Barrier: India's vast labor force remains underutilized due to limited employment opportunities. This
untapped potential constrains the economy's ability to harness its demographic dividend.

Strategy: Unlocking labor force potential mandates a comprehensive approach. Prioritizing skill
development aligns the workforce with evolving industry needs. Encouraging entrepreneurship
empowers individuals to create employment opportunities particularly in emerging sectors. This helps
absorb new entrants into the workforce culminating enhanced overall productivity and inclusive growth.

4. Balancing Price Stability:

Barrier: Price volatility disrupts economic stability, impacting investment decisions and overall growth
prospects.

Strategy: Balancing price stability is key. While excessively low inflation can stifle economic activity,
uncontrolled inflation can erode purchasing power. Moderate inflation maintains stable interest rates,
encouraging investment, and stable exchange rates bolster international trade for sustained growth.

5. Fiscal Consolidation for Investment:

Barrier: A lack of fiscal consolidation undermines government credibility and curtails resources for
strategic investments, impeding overall economic progress.

Strategy: Fiscal consolidation is vital for sustainable growth. Optimized public spending and reduced
deficits create room for strategic investment in social and economic infrastructure, stimulating both public
and private sectors and fostering inclusive growth.

By focusing on these strategies, a more inclusive form of economic development can be fostered:

Way Forward

1) Collaborative Policy Implementation: The successful execution of these strategies requires

collaboration among government agencies, private sectors, non-governmental organizations, and local
communities. Coordinated efforts ensure that policies are effectively implemented, resources are
optimally utilized, and outcomes are monitored and adjusted as needed.

2) Data-Driven Decision Making: Data collection and analysis play a critical role in understanding the
effectiveness of implemented strategies. Regular monitoring and evaluation of key economic indicators
help policymakers make informed decisions and fine-tune strategies for better outcomes.

In the pursuit of fostering a more inclusive framework for economic progress, it is imperative to
acknowledge and address the significant barriers that hinder the path to balanced and equitable growth.
By recognizing these challenges and actively working towards their resolution, we can cultivate an
economic environment that uplifts and empowers every individual, paving the way for a brighter future
for all.

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 Section III
Homework Question

Q) Explain different indices for measuring economic development. Which

measure is most appropriate to you and why? (10 marks, 400 words)

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