QUES . It is argued that the strategy of inclusive growth is intended to meet the objectives of inclusiveness and sustainability together. Comment on this statement. UPSC 2019 GS MAINS PAPER 3. 250 words. 15 Marks

HINTS:

How inclusive growth meets the objectives of inclusiveness and sustainability together?

Inclusive growth (IG) is economic growth that raises standards of livings for broad swaths of a population. IG adopts a long-term perspective and is concerned both with the pace and pattern of growth. High pace of growth is important, but how growth is generated is critical for growth sustainability and for accelerating employment creation and poverty reduction.

For growth to be sustainable in the long term, it should be broad-based across sectors. It should also be inclusive of the large part of the country’s labor force, where inclusiveness refers to equality of opportunity in terms of access to markets, resources, and unbiased regulatory environment for businesses and individuals. Thus, the strategy of inclusive growth is intended to meet the objectives of inclusiveness and sustainability together.

How the “Bharatiya Model of Inclusive Development” is “inclusive”?

The Bharatiya Model of Inclusive Development is based on “Sabka Sath, Sabka Vikas, Sabka Vishwas, Sabka Prayas“.

The following measures have been taken to achieve inclusiveness:

Creating job opportunities

Inclusive growth policies aim to create employment opportunities for all segments of society, including women, youth, and marginalized communities. For example setting up of National Skill Development Corporation. Startup India; Tech Startups: modern, quality jobs. Apprenticeship Act amendment to facilitate learning by doing, Pradhan Mantri Kaushal Vikas Yojana (PMKVY), Garib Kalyan Rojgar Abhiyaan (Poor Welfare Employment Campaign)

Ensuring access to basic services

Inclusive growth policies aim to ensure access to basic services such as education, healthcare, and housing for all members of society. For example: Atal Mission for Rejuvenation and Urban Transformation AMRUT, Ujjawala yojna, PM Awas Yojna– Rural and Urban, PM Saubhagya: Sahaj Bijli Har Ghar Yojana (Universal electricity connections), Deendayal Upadhyaya Gram Jyoti Yojana (Rural Electrification), Unnat Jyoti by Affordable LEDs for All, Swachh Bharat Mission, Jal Jeevan Yojana (clean drinking water), Ayushman Bharat-Health and Wellness Centres, PM-POSHAN, Prime Minister’s Overarching Scheme for Holistic Nourishment.

Addressing income inequality

Inclusive growth policies aim to address income inequality by promoting equitable distribution of resources. For example in the short term Direct Benefit Transfers (DBT) , DCT-farmers, Deendayal Antyodaya Yojana, Subsidized food for 2/3rd of population

How the “Bharatiya Model of Inclusive Development” is “sustainable”?

Inclusive growth policies in India also aim to promote sustainability by ensuring that economic growth is environmentally sustainable and does not harm future generations.

The following measures have been taken to achieve sustainability:

Promoting renewable energy

Inclusive growth policies promote the use of renewable energy sources such as solar and wind power, which are environmentally sustainable. For example: International Solar alliance, BS6 norms, etc.

Reducing carbon emissions

Inclusive growth policies aim to reduce carbon emissions by promoting sustainable transport, energy-efficient buildings, and low-carbon industries. For example: FAME India (Faster Adoption and Manufacturing of Electric (& Hybrid) Vehicles in India Scheme).

Protecting natural resources

Inclusive growth policies aim to protect natural resources such as forests and water bodies by promoting sustainable agriculture and responsible mining practices. For example: National Hydrology Project (Multi-pronged project to improve hydrology related practices).

But why the growth story of India is not visible on the ground?

While government welfare schemes have successfully reduced multidimensional poverty, they are not a substitute for organic income growth through employment, ultimately driving sustainable consumption and economic growth.

Despite economic growth, the continued reliance on MGNREGA for employment indicates structural job market issues and persistent unmet demand for employment.

Discrepancy between GDP growth and individual consumption reflects growing income disparities, with the brunt being borne by rural and lower to middle-income households.

What is the way forward?

• Job Creation Initiatives: Promote policies that incentivize employment creation, especially in the private sector, including infrastructure development and support for entrepreneurship in rural areas.

• Managing Inflation: Ensure monetary and fiscal policies are attuned to manage inflation so that nominal wage increases translate to real income growth.

• Encouraging Private Investment: Implement reforms that boost investor confidence and attract investments in key sectors that can lead to job-rich growth.

• Rural Income Enhancement: Increase the real income of rural workers by augmenting initiatives like MGNREGA and promoting rural industrialization to create jobs outside the agricultural sector.

• Targeted Support for Agriculture: Offer more support to the agricultural sector through investment in technology and infrastructure, enabling better productivity and higher revenue potential.

• Comprehensive Job Creation: Foster an environment conducive to investment, which could lead to more robust job creation, particularly in industries with the potential to employ large labor forces and add value to the economy.

• Focus on Skill Development: Implement larger-scale skill development programs for urban and rural populations to prepare the workforce for current and future market demands.

Conclusion:

To ensure that the growth is sustainable and inclusive, there is an imperative to create employment opportunities that spur income growth and reduce inequality. This will lay the foundation for a cycle of positive economic outcomes where increased consumption demands are met by increased production and investments, leading to persistent, broad-based economic development.