Inequality vs Growth | Economy for UPSC 2024 (Pre & Mains) PDF Download

 Page 1


 
Financial 
Inclusion 
(Economy) 
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our YouTube channel for entire GS Course  FREE  of cost 
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Page 2


 
Financial 
Inclusion 
(Economy) 
Visit our website www.sleepyclasses.com or  
our YouTube channel for entire GS Course  FREE  of cost 
Also Available: Prelims Crash Course || Prelims T est Series 
1. What is Financial Inclusion ? 1 ................................................................
2. Why do we Need Financial Inclusion 1 ................................................
3. What according to you shall be the priority of the policy makers in 
India: Reducing inequality or having a high GDP growth?  
Comment in not more than 200 words. 2 ...........................................
Structure 2 ........................................................................................................................
4. Quote some Schemes like 3 .....................................................................
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T able of Contents
Page 3


 
Financial 
Inclusion 
(Economy) 
Visit our website www.sleepyclasses.com or  
our YouTube channel for entire GS Course  FREE  of cost 
Also Available: Prelims Crash Course || Prelims T est Series 
1. What is Financial Inclusion ? 1 ................................................................
2. Why do we Need Financial Inclusion 1 ................................................
3. What according to you shall be the priority of the policy makers in 
India: Reducing inequality or having a high GDP growth?  
Comment in not more than 200 words. 2 ...........................................
Structure 2 ........................................................................................................................
4. Quote some Schemes like 3 .....................................................................
www.YouTube.com/SleepyClasses 
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T able of Contents 1. What is Financial Inclusion ? 
• Financial inclusion means that individuals and businesses have access to useful and affordable 
?nancial products and services that meet their needs.  
• It includes:  
•
Transactions  
• Payments  
• Savings  
•
Credit  
• Insurance  
•
Being delivered in a responsible and sustainable way. 
• “ A humdred small steps” , a report by committee on ?nancial sector Reforms under the chairmanship 
of Rahuram Rajan highlighted the following as part of Financial Inclusion 
2. Why do we Need Financial Inclusion 
1. Financial inclusion broadens the resource base of the ?nancial system  
2. Develops a culture of saving among large segment of rural population  
3. It will ensure institutional credit facilities more easily  
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www.SleepyClasses.com 
 1
Page 4


 
Financial 
Inclusion 
(Economy) 
Visit our website www.sleepyclasses.com or  
our YouTube channel for entire GS Course  FREE  of cost 
Also Available: Prelims Crash Course || Prelims T est Series 
1. What is Financial Inclusion ? 1 ................................................................
2. Why do we Need Financial Inclusion 1 ................................................
3. What according to you shall be the priority of the policy makers in 
India: Reducing inequality or having a high GDP growth?  
Comment in not more than 200 words. 2 ...........................................
Structure 2 ........................................................................................................................
4. Quote some Schemes like 3 .....................................................................
www.YouTube.com/SleepyClasses 
www.SleepyClasses.com 
T able of Contents 1. What is Financial Inclusion ? 
• Financial inclusion means that individuals and businesses have access to useful and affordable 
?nancial products and services that meet their needs.  
• It includes:  
•
Transactions  
• Payments  
• Savings  
•
Credit  
• Insurance  
•
Being delivered in a responsible and sustainable way. 
• “ A humdred small steps” , a report by committee on ?nancial sector Reforms under the chairmanship 
of Rahuram Rajan highlighted the following as part of Financial Inclusion 
2. Why do we Need Financial Inclusion 
1. Financial inclusion broadens the resource base of the ?nancial system  
2. Develops a culture of saving among large segment of rural population  
3. It will ensure institutional credit facilities more easily  
www.YouTube.com/SleepyClasses 
www.SleepyClasses.com 
 1
4. Further, by bringing low income group within the perimeter of formal banking sector; ?nancial 
inclusion protects their ?nancial wealth and other resources in exigent circumstances. 
5. It also mitigates the exploitation of vulnerable sections by the usurious money lenders by 
facilitating easy access to formal credit. 
6. People will be able to access insurance facilities  
7. Help in implementing social security schemes 
8. It helps to reduce rural urban divide and rich poor divide. 
9. It will help in better monitoring and regulation of ?nancial transations using digital technology 
10.Enhances economic development. 
11.Paves the way for less-cash Economy  
12.Helps in formalization of economy 
13.Helps better target the bene?ciaries of subsidies. 
3. What according to you shall be the priority of the policy 
makers in India: Reducing inequality or having a high GDP 
growth?  Comment in not more than 200 words.  
Structure 
• Discuss what are Inequalities and why reducing inequalities is important. 
•
Discuss why growth also needs to be ensured. 
• Show how both can be achieved simultaneously. 
•
Conclude with a few words of caution or criticism 
Inequalities exist in 
• Income  
•
Gender  
• Regional  
•
Rural-Urban  
• Digital 
Why reducing inequality is important?   
•
Distributive justice- even enshrined in DPSP Article 39. 
• Unsustainable to grow without eliminating inequality 
•
A. Sen says: An ill and illiterate workforce can’t make a nation prosperous 
• Market forces won’t function till inequality is addressed (AAA)  
www.YouTube.com/SleepyClasses 
www.SleepyClasses.com 
 2
Page 5


 
Financial 
Inclusion 
(Economy) 
Visit our website www.sleepyclasses.com or  
our YouTube channel for entire GS Course  FREE  of cost 
Also Available: Prelims Crash Course || Prelims T est Series 
1. What is Financial Inclusion ? 1 ................................................................
2. Why do we Need Financial Inclusion 1 ................................................
3. What according to you shall be the priority of the policy makers in 
India: Reducing inequality or having a high GDP growth?  
Comment in not more than 200 words. 2 ...........................................
Structure 2 ........................................................................................................................
4. Quote some Schemes like 3 .....................................................................
www.YouTube.com/SleepyClasses 
www.SleepyClasses.com 
T able of Contents 1. What is Financial Inclusion ? 
• Financial inclusion means that individuals and businesses have access to useful and affordable 
?nancial products and services that meet their needs.  
• It includes:  
•
Transactions  
• Payments  
• Savings  
•
Credit  
• Insurance  
•
Being delivered in a responsible and sustainable way. 
• “ A humdred small steps” , a report by committee on ?nancial sector Reforms under the chairmanship 
of Rahuram Rajan highlighted the following as part of Financial Inclusion 
2. Why do we Need Financial Inclusion 
1. Financial inclusion broadens the resource base of the ?nancial system  
2. Develops a culture of saving among large segment of rural population  
3. It will ensure institutional credit facilities more easily  
www.YouTube.com/SleepyClasses 
www.SleepyClasses.com 
 1
4. Further, by bringing low income group within the perimeter of formal banking sector; ?nancial 
inclusion protects their ?nancial wealth and other resources in exigent circumstances. 
5. It also mitigates the exploitation of vulnerable sections by the usurious money lenders by 
facilitating easy access to formal credit. 
6. People will be able to access insurance facilities  
7. Help in implementing social security schemes 
8. It helps to reduce rural urban divide and rich poor divide. 
9. It will help in better monitoring and regulation of ?nancial transations using digital technology 
10.Enhances economic development. 
11.Paves the way for less-cash Economy  
12.Helps in formalization of economy 
13.Helps better target the bene?ciaries of subsidies. 
3. What according to you shall be the priority of the policy 
makers in India: Reducing inequality or having a high GDP 
growth?  Comment in not more than 200 words.  
Structure 
• Discuss what are Inequalities and why reducing inequalities is important. 
•
Discuss why growth also needs to be ensured. 
• Show how both can be achieved simultaneously. 
•
Conclude with a few words of caution or criticism 
Inequalities exist in 
• Income  
•
Gender  
• Regional  
•
Rural-Urban  
• Digital 
Why reducing inequality is important?   
•
Distributive justice- even enshrined in DPSP Article 39. 
• Unsustainable to grow without eliminating inequality 
•
A. Sen says: An ill and illiterate workforce can’t make a nation prosperous 
• Market forces won’t function till inequality is addressed (AAA)  
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 2
But growth also needs to be ensured because:   
•
Growth will generate resources for inequality reduction. 
• Growth will help create meaningful employment increase quality of life. 
•
Growth with proper regulatory framework can eliminate inequality if it trickles down well.  
Both can be achieved simultaneously because:   
• Relatively low oil prices reduce govt’s ?scal burden, freeing more resources for development 
purposes. 
• Investing in demographic dividend will help achieve both. 
•
Welfarist govt. won’t let go of developmental agendas while forces of globlisation call for growth in 
income. 
• A slowing global economy & a rising Indian economy present a unique opportunity where world will 
invest in India given appropriate policy framework is made ready (labour law, energy policy, infra, PPP 
framework)  
A word of Caution 
• Growth will lead to loss of environment, which eventually comes to hurt poor the most, and it needs 
to be taken into account. 
•
FRBM act puts limits on developmental ?nance that the govt. can mobilise. 
• Rise of automation and AI present unique and unforeseen challenges before the policymakers to 
provide employment to a vastly unskilled or under skilled population.  
4. Quote some Schemes like 
• Skill India, some schemes in Education, Health, MII, Ease of Doing business, etc.
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