2022 · GS Paper 3 · Q2 · 10 marks
Is inclusive growth possible under market economy ? State the significance of financial inclusion in achieving economic growth in India.
In short
Inclusive growth is possible under a market economy when the state corrects market exclusion and widens the poor's access to markets. Financial inclusion drives growth by mobilising savings and credit, as PMJDY's 55.98 crore beneficiaries and the RBI's Financial Inclusion Index of 67.0 in 2025 show.
Model answer
Ghissu Editorial · Verified 4 Oct 2026 · 272 words
Markets create surplus
Post-1991 reforms raised growth and cut Tendulkar poverty from 37.2% in 2004-05 to 21.9% in 2011-12, and to 2.3% by 2023-24 (Economic Survey 2025-26).
Markets also exclude
They reward assets and skills, so uncorrected they widen gaps, as the Kuznets curve suggests.
State as enabler
Public health, education and safety nets, as in Kerala and the Nordic economies, let the poor participate in markets and make market growth inclusive.
Mobilising savings
PMJDY's 55.98 crore beneficiaries (PIB, 2025) bring household cash into the formal system.
Credit for enterprise
Mudra's 57 crore loans worth Rs 40.07 lakh crore (PIB, 2026) finance micro-entrepreneurs who create most non-farm jobs.
Efficient transfers
Through the JAM trinity, over Rs 51 lakh crore has moved by DBT up to June 2026, cutting leakages and freeing fiscal space.
Digital leap
The World Bank's G20 note (2023) found India reached 80% inclusion in six years instead of 47, while PMSBY and Atal Pension Yojana cover risk.
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Inclusive Growth11 questions
Asked in 9 of 14 sittings since 2013
- 2026Examine the view that financial inclusion is an integral part of social and economic inclusion in a country like India. Also throw light on the usefulness of the R.B.I.'s Financial Inclusion Index. (Answer in 150 words)
- 2023Distinguish between 'care economy' and 'monetized economy'. How can care economy be brought into monetized economy through women empowerment?
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Question from the official UPSC Civil Services (Main) Examination 2022 paper. Answer written by Ghissu's engine and checked against our editorial standards. Found an error? Tell us and we correct it within 48 hours.