Inclusive Growth
India has become one of the fastest-growing economies in the world. But growth alone is not enough—if only a small section of society benefits, the majority of people remain poor, unemployed, and excluded. That is why we need inclusive growth.
What is Inclusive growth?
Inclusive growth means growth that is broad-based, shared, and sustainable, where all sections of society—rich and poor, rural and urban, men and women—get equal opportunities to benefit.
In simple words, it is “growth for all and growth by all.”
Why Inclusive Growth Matters
- Economic growth without inclusion leads to inequality and social unrest.
- Inclusive growth ensures poverty reduction.
- It promotes social justice and equality.
- It helps build a stable and sustainable economy.
👉 Example: India’s GDP has grown rapidly since the 1990s, but many poor people, especially in rural areas, have not seen much improvement in their income. This shows that growth has not always been inclusive.
Features of Inclusive Growth
- Broad-based – Covers all sectors like agriculture, industry, and services.
- Equality of Opportunity – Everyone should have access to education, jobs, healthcare, and markets.
- Reduction of Poverty and Inequality – Benefits should reach the poorest first.
- Employment Generation – More productive jobs for the youth.
- Sustainability – Protecting environment and resources for future generations.
Inclusive Growth vs Economic Growth
| Aspect | Economic Growth | Inclusive Growth |
|---|---|---|
| Focus | Increase in GDP | GDP + equal opportunities |
| Beneficiaries | Limited section (often rich) | All sections of society |
| Goal | Higher output | Fair distribution + poverty reduction |
| Sustainability | May ignore environment | Long-term sustainable development |
| Example | Growth in IT sector only | Growth in IT + agriculture + MSME + rural jobs |
Inclusive Growth in India: A Snapshot
- India’s GDP growth (2010–2020) averaged around 6–7% per year.
- Poverty reduced from 55% in 1973 to about 10–12% (2023 estimate).
- But income inequality has increased – top 1% own ~40% of wealth (Oxfam 2022).
- Rural areas still face low incomes, unemployment, and poor infrastructure.
- Female labour force participation is just ~25%, one of the lowest in the world.
👉 This means India’s growth is not fully inclusive yet.
Dimensions of Inclusive Growth
Inclusive growth is multi-dimensional, not just about income.
| Dimension | Explanation | Example |
|---|---|---|
| Economic | Growth in jobs, income, infrastructure | More MSME jobs, rural roads |
| Social | Equal access to education, healthcare, gender equality | Free school education, Ayushman Bharat |
| Political | Participation of all groups in decision-making | Panchayati Raj reservations |
| Regional | Balanced growth across states and regions | Special schemes for Northeast, backward districts |
| Environmental | Growth without harming environment | Renewable energy, sustainable farming |
Challenges to Inclusive Growth in India
1. Poverty and Inequality
- Even though poverty has reduced, inequality is rising.
- Top 10% own 77% of wealth (Oxfam 2022).
2. Unemployment
- India has a large young population, but job creation is slow.
- Most jobs are in the informal sector (low pay, no security).
3. Regional Imbalances
- States like Maharashtra, Gujarat, and Karnataka are industrially advanced.
- States like Bihar, Odisha, and Jharkhand lag behind.
4. Low Human Development
- India ranks 132 on Human Development Index (HDI 2022).
- Malnutrition, low literacy, and poor health remain challenges.
5. Gender Inequality
- Women’s workforce participation is only ~25%.
- Gender wage gap continues.
6. Agricultural Distress
- Over 40% of workforce still depends on agriculture.
- Low productivity and dependence on monsoon make farmers vulnerable.
Government Initiatives for Inclusive Growth
The Government of India has launched many schemes to promote inclusion:
Poverty Reduction
- MGNREGA (2005) – 100 days of rural wage employment.
- National Food Security Act (2013) – Subsidised food grains.
- PM Awas Yojana – Affordable housing.
Employment & Skills
- Skill India Mission (2015) – Training youth.
- Startup India, Stand-up India – Entrepreneurship promotion.
- Make in India – Manufacturing jobs.
Financial Inclusion
- Pradhan Mantri Jan Dhan Yojana (2014) – Bank accounts for poor.
- Direct Benefit Transfer (DBT) – Direct transfer of subsidies.
Social Inclusion
- Ayushman Bharat (2018) – Health insurance for poor.
- Right to Education (2009) – Free education for children.
- Beti Bachao, Beti Padhao – Empowering girl child.
Regional Development
- Aspirational Districts Programme (2018) – Develop backward districts.
- Special Economic Packages – For Northeast and hilly states.
Data Snapshot: Inclusive Growth Indicators
| Indicator | India’s Status |
|---|---|
| GDP Growth (2022–23) | ~7% |
| Poverty Rate | ~10–12% (multi-dimensional) |
| Unemployment Rate | ~7–8% |
| Female Workforce Participation | ~25% |
| Literacy Rate | ~77% (2023) |
| HDI Rank | 132 (out of 191 countries) |
Inclusive Growth in Five-Year Plans (Historical Context)
India’s planning approach has always aimed for inclusive development:
| Plan | Focus on Inclusion |
|---|---|
| 10th Plan (2002–07) | “Faster growth with equity” |
| 11th Plan (2007–12) | “Inclusive growth” explicitly mentioned |
| 12th Plan (2012–17) | “Faster, sustainable, and more inclusive growth” |
| Post-2017 (NITI Aayog) | SDGs (Sustainable Development Goals) and inclusive policies |
Link with Sustainable Development Goals (SDGs)
Inclusive growth is closely linked to United Nations SDGs:
- No Poverty (Goal 1)
- Zero Hunger (Goal 2)
- Quality Education (Goal 4)
- Decent Work and Economic Growth (Goal 8)
- Reduced Inequalities (Goal 10)
👉 India’s policies are designed to align with these goals.
Way Forward for Inclusive Growth in India
- Job-Oriented Growth
- Focus on labour-intensive sectors like manufacturing, MSMEs, tourism.
- Education and Skills
- Improve quality of education.
- Link skill training with industry demand.
- Healthcare Access
- Strengthen public health system.
- Expand Ayushman Bharat coverage.
- Agriculture Reform
- Modernise farming with technology.
- Provide better market access and MSP support.
- Women Empowerment
- Increase female labour force participation.
- Provide childcare support, equal pay.
- Reduce Regional Inequalities
- More investment in backward states.
- Improve connectivity and infrastructure.
- Financial Inclusion
- Expand digital banking.
- Affordable credit for poor and MSMEs.
- Environmental Sustainability
- Promote renewable energy.
- Encourage eco-friendly industries.
Conclusion
Inclusive growth is not just about increasing GDP but ensuring that the benefits of growth reach everyone in society—especially the poor, women, rural population, and vulnerable groups.
India has made progress with poverty reduction, social schemes, and financial inclusion. However, challenges like inequality, unemployment, and regional imbalance remain.
For the future, India needs job creation, better education and healthcare, women empowerment, and sustainable development. Only then can growth become truly inclusive and lead to a prosperous, just, and equal society.
👉 Inclusive growth is the only way to make India’s growth story meaningful for all citizens.
