UPSC Mains Previous Year Questions 2024: GS3 Indian Economy | Indian Economy for UPSC CSE PDF Download

Q1: Examine the pattern and trend of public expenditure on social services in the post reforms period in India. To what extent this has been in consonance with achieving the objective of inclusive growth? (Answer in 150 words)
Ans: 
Introduction
Government spending on social services has experienced a 5.9% compound annual growth rate (CAGR) from FY12 to FY23, highlighting increased prioritization of education, healthcare, and rural development since the 1991 economic reforms aimed at fostering inclusive growth.
Body
Patterns and Trends of Public Expenditure on Social Services (Post-Reform Period):

• Rising Allocations: Public spending on social services increased from 5.3% of GDP in 2000-01 to 8.3% in 2022-23, with primary focus areas including education, healthcare, and welfare.
• Education Sector: Expenditure on education rose from 2.8% to 3.1% of GDP by 2022-23. The FY 2023-24 budget earmarked Rs.1.12 lakh crore for education.
• Health Sector: Healthcare spending grew from 0.9% to 2.1% of GDP by 2022-23. For FY 2023-24, Rs.89,155 crore was allocated to health initiatives.
• Social Welfare Programs: Funding for schemes like MGNREGA increased, with allocations rising from Rs.60,000 crore in 2023-24 to Rs.86,000 crore in 2024-25 to alleviate poverty.
• Skill Development and Digital Inclusion: Initiatives such as Digital India and Skill India have received enhanced funding, targeting digital literacy, reducing the digital divide, and fostering employment through skill development programs aimed at skilling 20 lakh youth over five years (Budget 2024-25).

Alignment with Achieving Inclusive Growth:

• Education: Increased spending has broadened access to education, but challenges in quality and equity remain. For instance, the Gross Enrollment Ratio (GER) for ages 18-23 is only 28.4%.
• Healthcare: Although healthcare spending has risen, rural healthcare services and access for marginalized populations continue to lag behind.
• Poverty and Inequality: Social welfare schemes have contributed to poverty reduction, but issues like fund underutilization and implementation gaps hinder comprehensive inclusive growth.

Conclusion
While public expenditure on social services has grown in post-reform India, fostering inclusive growth requires enhancing resource efficiency and ensuring targeted support for beneficiaries. Sustained efforts to address systemic challenges alongside continued investments in social sectors are crucial to realizing the vision of inclusive development.

Q2: What are the causes of persistent high food inflation in India? Comment on the effectiveness of the monetary policy of the RBI to control this type of inflation. (Answer in 150 words)
Ans: 
Introduction
As per the Consumer Price Index (CPI), food inflation in August 2024 stood at 5.66%, with rural inflation reaching 6.02% and urban inflation at 4.99%. The persistent challenge of high food inflation in India impacts the economy significantly, necessitating a deeper understanding of its causes to evaluate the Reserve Bank of India's (RBI) monetary policy effectiveness.
Body
Causes of Persistent High Food Inflation in India

• Climate Change: Unpredictable weather patterns, droughts, and floods disrupt crop yields, driving up food prices.
• Supply Chain Disruptions: Logistical challenges, including transportation bottlenecks and storage inadequacies, exacerbate inflationary pressures.
• Rising Production Costs: Increased input costs for seeds, fertilizers, and energy contribute to higher food prices.

Effectiveness of RBI's Monetary Policy in Controlling Food Inflation
The RBI operates under a Flexible Inflation Targeting (FIT) framework, aiming to maintain inflation at 4%. However, food inflation continues to present hurdles despite its monetary interventions:

• FIT Framework: While designed to stabilize prices and support growth, the framework struggles with food inflation driven by supply-side factors.
• Interest Rate Adjustments: Although the RBI adjusts policy rates to curb inflation, the impact on food prices is limited due to external factors like global commodity prices and climate volatility.
• Lag in Policy Impact: Monetary policy measures typically take 2-3 quarters to show effects, making them less effective for addressing short-term food price shocks.

Conclusion
The RBI’s monetary policy is a key tool in managing inflation, but addressing persistent food inflation requires a broader strategy. A coordinated approach involving fiscal interventions, structural reforms, advancements in agricultural practices, and enhanced supply chain efficiency is critical for ensuring long-term price stability. Such measures will not only stabilize food prices but also promote sustained economic growth, benefiting all stakeholders.

Q3: What were the factors responsible for the successful implementation of land reforms in some parts of the country? Elaborate. (Answer in 150 words)
Ans: 
Introduction
Land reforms involve changes in the ownership and management of land, typically introduced through government initiatives to improve the conditions of poor and landless farmers. These reforms encompassed measures such as the abolition of intermediaries, tenancy regulations, land ceiling laws, and land consolidation.
Body
The successful implementation of land reforms in regions like West Bengal and Kerala can be attributed to several key factors:

• Strong Political Commitment and Laws: State governments actively pursued land reforms by enforcing legislations such as the Bihar Land Reforms Act (1950) and the Bombay Tenancy Act (1948).
• Peasant Mobilization: Initiatives like Operation Barga in West Bengal empowered sharecroppers and implemented sharecropping reforms effectively.
• Grassroots Movements: Movements like Bhoodan and Gramdan in Telangana promoted voluntary land donations for redistribution.
• Efficient Land Record Systems: Technological advancements like digitization in Karnataka minimized corruption and property disputes.
• Political Awareness: The focus on agrarian issues during India’s freedom struggle fostered widespread support for reforms.

In contrast, land reforms faltered in other regions due to:

• Deficient Land Records: Inaccuracies in land descriptions and boundaries hindered progress.
• Lack of Political and Bureaucratic Support: Delays and a lack of commitment weakened implementation.
• Exemptions for Plantations: Excluding plantations from reforms reduced their overall impact.
• High Land Ceiling Limits: These ceilings allowed landowners to evade redistribution laws easily.

Conclusion
To improve the effectiveness of land reforms, initiatives like the Digital India Land Records Modernization Programme (DILRMP), promoting collective farming practices, and leveraging Geographic Information Systems under schemes like Swamitva can play a pivotal role.

Q4: Explain the role of millets for ensuring health and nutritional security in India. (Answer in 150 words)
Ans: 
Introduction
Millets, often referred to as "nutri-cereals," are resilient to drought and offer significant nutritional value, containing 7-12% protein and a superior amino acid composition. These superfoods are not only highly nutritious but also cost-effective. Recognizing their importance, the United Nations has declared 2023 as the International Year of Millets.
Body
Health Benefits of Millets:

• Gluten-Free and Low Glycemic Option: Millets are naturally gluten-free, rich in fiber, and have a low glycemic index, making them a suitable choice for individuals with gluten intolerance or celiac disease.
• Prevention of Lifestyle Diseases: Their high dietary fiber, antioxidants, and essential minerals like magnesium and iron help mitigate risks associated with diabetes, obesity, and other lifestyle-related disorders.
• Boosting Immunity: Millets, such as pearl millet (bajra), are rich in B vitamins, zinc, and selenium, which play a vital role in enhancing immune function.

Millets and Nutritional Security:

• Addressing Micronutrient Deficiencies: Millets help combat "hidden hunger" caused by nutrient deficiencies. For instance, around 30% of Indian women aged 15-49 suffer from iron deficiency anemia, a challenge that millets can help address.
• Sustainable Nutrition: As photo-insensitive and climate-resilient crops, millets thrive in water-scarce regions, such as Maharashtra and Rajasthan. Their cultivation supports farmers while contributing to nutritional security in vulnerable areas.

Conclusion
Initiatives like Nutritional Security through Intensive Millets Promotion (INSIMP) and increased Minimum Support Prices (MSP) for millets are pivotal steps toward a healthier society. Embracing these nutrient-dense grains can help foster sustainable food practices and promote overall well-being for future generations.

Q5: Discuss the merits and demerits of the four Labour Codes' in the context of labour market reforms in India. What has been the progress so far in this regard? (Answer in 250 words)
Ans: 
Introduction
India's four Labour Codes—covering Wages, Industrial Relations, Social Security, and Occupational Safety—mark a transformative revision of the nation's labor legislation framework.
Body
Advantages

• Streamlined Regulations: By consolidating over 40 labor laws into four comprehensive codes, compliance becomes more straightforward for businesses, reducing administrative hurdles.
• Greater Employer Flexibility: The Industrial Relations Code raises the threshold for retrenchment requiring government approval from 100 to 300 employees, offering businesses more operational leeway.
• Expanded Worker Benefits: The Social Security Code broadens the scope of welfare measures to include gig and platform workers, addressing their long-standing lack of formal coverage.
• Workplace Safety Enhancements: The Occupational Safety Code enforces stricter workplace safety protocols, such as mandatory health checks, safety committees, and improved worker facilities.

Disadvantages

• Lack of Clarity in Definitions: Ambiguous terms for categories like workers and gig workers create potential for misinterpretation and abuse.
• Exclusion of Marginalized Sectors: Charitable organizations and NGOs are excluded from the Occupational Safety Code, leaving many workers without formal protections.
• Uneven Implementation by States: Delays and inconsistencies in implementation across states may undermine the intended uniformity of labor reforms.
• Barriers to Union Representation: Requiring 75% worker approval for union recognition may weaken collective bargaining and fragment representation.
• Risk of Worker Exploitation: The introduction of fixed-term contracts might lead to reduced worker security and diminished labor rights.

Progress to Date

• Parliamentary Approval: All four codes have been approved by Parliament and have received presidential assent.
• Pending Enforcement: Despite being passed in 2019 and 2020, the codes are yet to be implemented.
• State-Level Action: As of June 2024, 24 states and union territories have formulated rules for all four codes.

Conclusion
The Labour Codes aim to streamline and modernize India’s labor regulations, fostering a more dynamic labor market. However, their full implementation remains a work in progress, and their impact will hinge on timely and consistent enforcement across states.

Q6: What is the need for expanding the regional air connectivity in India? In this context, discuss the government's UDAN Scheme and its achievements. (Answer in 250 words)
Ans: 
Introduction
Expanding regional air connectivity is essential for fostering inclusive and balanced development in India. To achieve this objective, the Indian government launched the Regional Connectivity Scheme – Ude Desh Ka Aam Nagrik (RCS-UDAN).
Body
The Need for Regional Air Connectivity

• Economic Growth: Improved connectivity promotes local economic development by encouraging trade, tourism, and investments in previously inaccessible regions.
• Access to Services: Enhanced air links ensure better access to healthcare, education, and other essential services for people in remote areas.
• Employment Generation: Increased air travel creates job opportunities in aviation, hospitality, and allied sectors, benefiting local communities.
• Tourism Development: It boosts tourism in remote, picturesque areas and helps bridge the urban-rural divide, fostering equitable development.
• Disaster Response: Efficient air connectivity enables faster and more effective responses to natural disasters and emergencies.

RCS-UDAN: An Overview

The UDAN scheme, introduced as part of the 2016 National Civil Aviation Policy, focuses on improving air infrastructure and connectivity in underserved and remote areas. Its goal is to make air travel affordable and accessible to the general public.

Key Achievements

• Multiple Phases of Growth: The scheme has evolved through successive versions, including UDAN 5.1, 5.2, and 5.3, which emphasize last-mile connectivity and the promotion of tourism using smaller aircraft.
• Passenger Benefits: Over 1 crore passengers have benefited, with more than 2.5 lakh flights operated under the scheme, significantly enhancing airport infrastructure and affordability of air travel.
• Operational Milestones: As of April 2024, 85 airports have been made operational under UDAN.
• Nationwide Impact: The scheme connects 30 States and Union Territories, operationalizing unserved and underserved airports, heliports, and water aerodromes. Examples include routes from Mundra in Gujarat to Tezu in Arunachal Pradesh and Hubli in Karnataka.

Conclusion
While challenges like incomplete operational routes, low occupancy rates, and infrastructure gaps persist, the RCS-UDAN scheme has transformed India’s aviation landscape. It has made air travel more affordable for middle-class citizens and established vital links to remote regions, contributing to the country’s balanced development.

Q7: What are the major challenges faced by the Indian irrigation system in recent times? State the measures taken by the government for efficient irrigation management. (Answer in 250 words)
Ans: 
Introduction
Agriculture in India accounts for nearly 80% of the nation’s annual freshwater usage, consuming approximately 700 billion cubic meters. By 2022-23, about 52% of the total 141 million hectares of cultivated land had access to irrigation, up from 41% in 2016. This underscores the critical role of effective irrigation management in addressing the sector’s persistent challenges.
Challenges Faced by the Indian Irrigation System

• Groundwater Depletion: Excessive reliance on groundwater has caused significant declines in water tables in nearly 64% of districts.
• Impact of Climate Change: Changing river flows and rising water demands from crops are exacerbating water scarcity.
• Aging Infrastructure: Much of the irrigation infrastructure is outdated, requiring substantial upgrades to meet current needs.
• Maintenance Issues: Poor upkeep of canals and the lack of community involvement lead to inefficiencies in water distribution.
• Shifts in Land Use: Changes in cropping patterns, particularly the cultivation of water-intensive crops in arid regions, disrupt sustainable agricultural plans.
• Funding Constraints: Insufficient funding for irrigation projects and the mismanagement of allocated funds hinder progress.

Government Initiatives for Improved Irrigation Management

• Pradhan Mantri Krishi Sinchai Yojana (PMKSY): This program aims to strengthen irrigation networks and expand coverage to boost farm productivity.
• Jal Shakti Abhiyan (JSA): Launched in 2019, it emphasizes water conservation and management, especially in 256 water-stressed districts.
• Catch the Rain Campaign: Introduced in 2021, this initiative promotes rainwater harvesting and conservation efforts across all districts.
• Bureau of Water Use Efficiency (BWUE): Established in 2022, it focuses on optimizing water use across sectors, including agriculture.
• Per Drop More Crop (PDMC): Operational since 2015-16, it advocates for micro-irrigation methods like drip and sprinkler systems to enhance water efficiency.

Conclusion
Addressing issues like water scarcity and outdated systems requires a focus on sustainable irrigation practices and modernization. The adoption of micro-irrigation, efficient utilization of funds, and community-driven management are vital for securing water resources and enhancing agricultural productivity in India.

Q8: Elucidate the importance of buffer stocks for stabilizing agricultural prices in India. What are the challenges associated with the storage of buffer stock? Discuss. (Answer in 250 words)
Ans: 
Introduction
Buffer stocks refer to reserves of essential commodities maintained to manage price volatility and respond to emergencies. Initiated during the 4th Five Year Plan in India, these stocks play a critical role in stabilizing agricultural prices, safeguarding food security, and supporting farmers' livelihoods.
Body
Significance of Buffer Stocks in Stabilizing Agricultural Prices

• Food Security: Buffer stocks ensure the availability of food grains for vulnerable populations during adverse events like droughts or floods.
• Public Distribution: They support the monthly distribution of food grains through systems like the Public Distribution System (PDS) and Other Welfare Schemes (OWS).
• Emergency Relief: These reserves enable a quick response to crises such as crop failures or natural disasters.
• Price Stabilization: By regulating the supply of essential commodities, buffer stocks help stabilize prices. For example, during 2022-23, the Food Corporation of India (FCI) released 34.82 lakh tonnes of wheat to curb cereal inflation.
• Farmer Support: Ensures a guaranteed minimum support price (MSP) for agricultural produce, stabilizing incomes and promoting production.
• Disaster Response: Offers immediate food relief during emergencies, such as providing free rations during the COVID-19 pandemic.

Challenges

• Storage Limitations: Inadequate storage infrastructure results in significant spoilage and wastage—about 74 million tonnes or 22% of the annual foodgrain output.
• Procurement Imbalance: The focus on rice and wheat leads to overstocking, neglect of other crops, and hampers crop diversification efforts.
• Financial Costs: Maintaining large buffer stocks incurs substantial expenses in procurement, storage, and distribution, with transit losses alone costing the FCI around ₹300 crores annually.
• Inefficiencies in Distribution: Leakages, corruption, and pilferage in systems like the PDS undermine the effectiveness of food distribution. As per the 2022-23 NSS survey, distribution inefficiencies accounted for a 22% leakage rate.
• Quality Maintenance: Prolonged storage poses challenges in preserving the quality of food grains.

Conclusion
Buffer stocks are indispensable for price stabilization and food security in India. By addressing storage and procurement challenges, alongside improving infrastructure and distribution mechanisms, the system can become more efficient, ensuring benefits for both farmers and consumers while fostering economic stability.