Explain the concept of inclusive growth and examine its significance for overall development of India.
Inclusive growth refers to process and outcome, where every section of society participates in organisation of growth and benefits from it equally (UNDP).
IMF chief economist Ms. Gopinath argues that Growth is inclusive when it:
- Occurs in sector where poor work.
- Use resources that poor produce (labour).
- Create value in sector on which poor depend (health, education).
Inclusive Growth:
- Economic – high growth, sustainable in nature.
- Environment – with concerns for environment.
- Pro-people – benefit all sections.
Significance for India:
- Nature of growth
- Jobless growth in India has failed to meet the needs of vast majority.
- g. During 2001-2011 economy grew at 7.7 % while employment increased by a mere 1.8%.
- Agriculture continues to employee 49% population while contributing only 16% to GDP.
- High inequality
- Oxfam – top 1% own 43% of national wealth.
- Global Gender Gap Report 2021 – women earn 1/5th of men’s wage, Labour force participation is below 20%.
- Global Hunger Index – largest incidence of hunger, stunting (37%), wasting (17%), undernourished (14%).
- Poor social infrastructure as highlighted during Covid pandemic.
Inclusive growth therefore becomes crucial to ensure:
- Balanced growth
- Capitalising on labour intensive sectors like textile.
- Increased social infrastructure investment (national health policy 2017 – increase in health expenditure to 2.5% of GDP).
- Reduced inequality
- High formalization
- Social security for gig platform workers.
- Impetus to agriculture sector
- Agriculture Infra fund of 1 lakh crore.
- Diversification of market.
- Environmental ethics as reflected in commitment to go carbon neutral by 2070.
As highlighted by the Prime Minister, inclusive growth is not mere slogan but driving force of our policy.
Topics: GS-III: Inclusive Growth and Issues Arising From It